FINAF 2 - socfin.com · Socfinaf S.A. – Annual Report 2019 - 6 • 31/12/2001 Further increase in share capital which allowed Intercultures to increase its stake in Okomu Oil Palm

Socfinaf S.A. – Annual Report 2019 - 1

Disclaimer: This document is an English translation of the official French version. In case of divergence, the official French version prevails.

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Table of contents

Group Profile .................................................................................................................. 5

1. Overview of the Group ........................................................................................................... 5

2. History ....................................................................................................................................... 5

3. Group Structure ....................................................................................................................... 7

4. Information on Socfinaf S.A.’s holdings ............................................................................... 8

International Market for Rubber and Palm Oil ......................................................... 23

1. Rubber ..................................................................................................................................... 23

2. Palm oil.................................................................................................................................... 25

Environment and Social Responsibility ..................................................................... 29

Key Figures ................................................................................................................... 30

1. Activity indicators ................................................................................................................. 30

2. Key figures from the consolidated income statement and the cash flow statement 31

3. Key figures from the consolidated statement of financial position ............................. 31

Stock market data ....................................................................................................... 31

Financial highlights of the year ................................................................................. 31

Corporate governance statement .............................................................................. 32

1. Introduction ............................................................................................................................ 32

2. Corporate Governance charter............................................................................................ 32

3. Board of Directors.................................................................................................................. 32

4. Committees of the Board of Directors ............................................................................... 36

4.1. Audit Committee ........................................................................................................... 36

4.2. Appointment and Remuneration Committee ........................................................... 36

5. Remuneration ......................................................................................................................... 36

6. Shareholding status ............................................................................................................... 37

7. Financial calendar ................................................................................................................. 37

8. External Audit ........................................................................................................................ 38

9. Corporate, social and environmental responsibility ........................................................ 38

10. Other information .................................................................................................................. 38

Statement of Compliance ........................................................................................... 39


Consolidated management report ............................................................................. 40

Audit report on the consolidated financial statements .......................................... 44

Consolidated financial statements ............................................................................ 49

1. Consolidated statement of financial position ................................................................... 49

2. Consolidated income statement ......................................................................................... 51

3. Consolidated statement of other comprehensive income .............................................. 52

4. Consolidated statement of cash flows ............................................................................... 53

5. Consolidated statement of changes in equity .................................................................. 54

6. Notes to the consolidated financial statements .............................................................. 56

Note 1. General and accounting policies................................................................................ 56

Note 2. Subsidiaries and associates ......................................................................................... 70

Note 3. Leases ............................................................................................................................. 74

Note 4. Intangible assets ........................................................................................................... 77

Note 5. Property, plant and equipment ................................................................................. 78

Note 6. Biological assets............................................................................................................ 80

Note 7. Non-wholly owned subsidiaries in which non-controlling interests are significant 82

Note 8. Investments in associates ........................................................................................... 84

Note 9. Financial assets at fair value through other comprehensive income .................. 88

Note 10. Deferred taxes ............................................................................................................ 89

Note 11. Inventory ...................................................................................................................... 90

Note 12. Trade receivables (Current assets) ......................................................................... 91

Note 13. Other receivables (current assets) .......................................................................... 92

Note 14. Current tax assets and liabilities ............................................................................. 92

Note 15. Cash and cash equivalent ......................................................................................... 93

Note 16. Share capital and share premium ............................................................................ 93

Note 17. Legal reserves ............................................................................................................. 94

Note 18. Pension obligations .................................................................................................... 94

Note 19. Financial debts ........................................................................................................... 96

Note 20. Other payables ............................................................................................................ 99

Note 21. Financial Instruments .............................................................................................. 100

Note 22. Staff costs and average number of staff .............................................................. 102


Note 23. Depreciation and impairment expense ................................................................ 102

Note 24. Impairment of assets ............................................................................................... 103

Note 25. Other financial products ......................................................................................... 104

Note 26. Finance charges ........................................................................................................ 105

Note 27. Tax expense .............................................................................................................. 105

Note 28. Net earnings per share ............................................................................................ 107

Note 29. Dividends and directors’ fees ................................................................................. 107

Note 30. Information on related party ................................................................................. 107

Note 32. Agricultural leases .................................................................................................... 111

Note 33. Segment information ............................................................................................... 111

Note 34. Risk management ..................................................................................................... 118

Note 35. Political and economic environment .................................................................... 121

Note 36. Events after the closing date ................................................................................. 121

Note 37. Auditor’s fees ............................................................................................................ 122

Company’s Management report ............................................................................... 123

Audit report on the Company’s financial statements ........................................... 129

Company Financial Statements ................................................................................ 133

1. Balance sheet as at 31st December 2018 ......................................................................... 133

2. Income statement for the year ended 31st December 2019 ......................................... 135

3. Notes to the parent company financial statements for the 2019 financial year ..... 136


Group Profile

1. Overview of the Group

Socfinaf S.A. is a Luxembourg company and its registered address is 4, Avenue Guillaume, L-1650, Luxembourg. It was incorporated on 22nd October 1961 and is listed on the Stock of Exchange of Luxembourg. The principal activity of Socfinaf S.A. is to manage a portfolio of shares mainly focused on the operation of more than 139 600 hectares of tropical palm oil and rubber plantations in Africa. Socfinaf S.A. employs 24 166 people and has achieved a consolidated turnover of EUR 376 million in 2019.

2. History

• 22/10/1961 Incorporation of Compagnie Internationale de Cultures (Intercultures) as a Luxembourg holding company.

• 31/12/1961 Intercultures invests in two Congolese plantations named “La Compagnie Congolaise de l’Hévéa” and “Cultures Equatoriales”.

• 18/04/1966 The shares of Intercultures have been listed on the Stock Exchange of Luxembourg.

• 31/12/1974 Nationalization measures of industrial enterprises by the State of Zaire.

• 31/12/1976 Progress of negotiations with Zaire - exit of Zairian holdings from the portfolio and accounting for Zaire claim.

• 19/05/1995 Increase of the share capital of Intercultures in order to relaunch the Company's activity in the field of tropical plantations.

• 30/06/1995 Acquisition of 65% of Société des Caoutchoucs du Grand Bereby "SOGB" in Ivory Coast via Bereby Finances "Befin", an Ivory Coast holding company.

• 30/06/1997 Acquired 5% of Palmci, an Ivory Coast company producing palm oils.

• 30/06/1998 Increase of share capital and investment in Kenya in 70.8% of Red Lands Roses Ltd, producer of roses and Socfinaf Company Ltd, coffee producer.

In addition, Intercultures acquired through its Luxembourg subsidiary (Indufina Luxembourg) 54% of an oil palm plantation in Nigeria, Okomu Oil Palm Company Plc.

• 31/03/1999 Intercultures continues the expansion of its investments in Africa and more specifically in Liberia: acquisition of 70% of Weala Rubber Company Ltd, owner of a rubber factory and 75% of Liberian Agricultural Company "LAC" which has a rubber concession.

• 31/03/2000 Acquisition of 89.64% of Société des Palmeraies de la Ferme Suisse "SPFS", a Cameroon company active in the production, processing and refining of palm oil.

• 31/12/2000 Through a Cameroon holding Palmcam, Intercultures continues its investments in Cameroon in Socapalm, a company active in the production and processing of palm oil.


• 31/12/2001 Further increase in share capital which allowed Intercultures to increase its stake in Okomu Oil Palm Company Plc and in Befin (parent company of SOGB).

• 31/12/2006 Restructuring of Socfinal Group's holdings, including the distribution of Intercultures shares by Socfinasia S.A. (spin-off) and repositioning of the Group's operating companies.

• 31/12/2007 Intercultures acquired 99.8% of Brabanta, a company developing a palm oil plantation in Congo (DRC).

On the other hand, Intercultures sold its holdings Weala Rubber Company Ltd (Liberia) and Palmci (Ivory Coast).

• 31/12/2008 Constitution of Sud Comoë Caoutchouc "SCC" (Ivory Coast) via the Ivorian holding Befin.

Intercultures sold 60% of Red Lands Roses (Kenya).

• 31/12/2009 Capital increase in Brabanta (DRC). Increased participation in Salala Rubber Corporation "SRC" (Liberia).

• 17/03/2010 Sale of Socfinaf Company Ltd (Kenya).

• 10/01/2011 Extraordinary General Meeting which ratifies the abandonment of the status of Holding company 29 and change of the denomination to Socfinaf S.A.

• 01/07/2011 Share split by 10.

• 06/10/2011 Acquisition of 32.9% of Palmcam’s shares which is totally owned by Socfinaf S.A.

• 31/12/2012 Acquisition of 3.4% of Okomu Oil Palm Company Plc’s shares.

Incorporation of Plantations Socfinaf Ghana Ltd "PSG".

• 23/10/2013 Acquisition of 100% of STP Invest S.A.’s shares, a Belgium company which owns 88% of Agripalma Lda, benefitting from a grant of 5 000 hectares concession on the island of São Tomé.

• 31/12/2014 Capital increase with the issue of 1 474 200 new shares subscribed by Socfin in exchange for 100% of the shares of Société Anonyme Forestière et Agricole "SAFA". It owns 68.93% of Safacam S.A. (Cameroon).

• 01/01/2015 Beginning of Sogescol Cameroon and Camseeds, which were formed in 2014 by Sogescol FR S.A. and Socfin Research S.A.

• 05/10/2015 Acquisition of shares in Socapalm to increase the percentage holding to 4.57%.

• 04/11/2015 Constitution of Sodimex FR and Induservices FR.

• 01/02/2016 Liquidation of Palmcam S.A. (Cameroon).

Socfinaf S.A. – Annual report 2019 - 7

3. Group Structure


4. Information on Socfinaf S.A.’s holdings

Portfolio Number of shares Direct %

Sierra Leone

Socfin Agricultural Company Ltd 119 970 000 93.00%

Liberia

Liberian Agricultural Company 25 000 100.00%

Salala Rubber Corporation 516 64.91%

Ivory Coast

Bereby-Finances S.A. 739 995 87.06%

Ghana

Plantations Socfinaf Ghana Ltd 750 000 100.00%

Nigeria

Okomu Oil Palm Company Plc 619 797 100 64.97%

Cameroon

Socapalm S.A. 3 086 856 67.46%

Democratic Republic of Congo

Brabanta S.A. 4 990 99.80%

France

Société Anonyme Forestière and Agricole "SAFA" 577 200 100.00%

Belgium

Socfinco S.A. 8 750 50.00%

Gaummes S.A. 17 670 50.00%

Centrages S.A. 7 500 50.00%

Immobilière de la Pépinière S.A. 3 333 50.00%

Sodimex S.A. 70 000 50.00%

STP Invest S.A. 1 800 100.00%

Luxembourg

Socfinde S.A. 50 000 20.00%

Terrasia S.A. 3 328 33.28%

Induservices S.A. 3 000 30.00%

Management Associates S.A. 2 000 20.00%

Switzerland

Sogescol FR S.A. 2 650 50.00%

Socfinco FR S.A. 650 50.00%

Socfin Green Energy S.A. 60 50.00%

Socfin Research S.A. 3 000 50.00%

Induservices FR S.A. 700 50.00%

Sodimex FR S.A. 675 50.00% The following pages contain a summary of the activity and comments on the financial information for the past two financial years in which Socfinaf S.A holds a direct or indirect participation. Unless indicated otherwise, equity includes capital, reserves and the results brought forward before allocation of current year results. Corporate data refers to consolidated data.

The balance sheets are presented in the functional currency of the respective company.


SOCFIN AGRICULTURAL COMPANY « SAC » LTD Share Capital: USD 30 000 000 SAC is active in Sierra Leone in the production of palm oils.

Key data Area (hectares) Planted area

As at 31st December 2019 Mature Immature Total

Palm plantation 12 349 0 12 349

Concessions: 18 473 hectares Permanent staff as at 31st December 2019: 1 434

Production and turnover Realized Realized

As at 31st December 2019 2018

Production (tons)

Palm oil 24 297 19 155

Turnover (EUR 000) 12 457 11 030

Result (EUR 000) -10 663 -5 325

Average sale price (EUR/kilo)

Palm oil 0.51 0.58

Average rate EUR/USD 1.12 1.18

Closing rate EUR/USD 1.12 1.14

Key figures (USD 000) As at 31st December 2019 2018

Fixed assets 142 136 144 804

Current assets 5 162 6 435

Equity (*) -1 721 10 212

Debts, provisions and third parties (*) 149 019 141 027

Results of the year -11 934 -6 274

Socfinaf S.A.’s holding. (%) 93.00 93.00

(*) Before allocation


LIBERIAN AGRICULTURAL COMPANY « LAC » Share Capital: USD 31 105 561 LAC is active in Liberia in the field of rubber cultivation and industrial rubber processing.



Rubber plantation 10 213 2 604 12 817




Production (tons) Rubber 24 939 21 384

Turnover (EUR 000) 29 750 22 799

Result (EUR 000) -1 239 -1 675

Average selling price (EUR/kg) Rubber 1.19 1.07




Fixed assets 82 843 81 647


Equity (*) 53 358 54 745

Debts, provisions and third parties (*) 46 290 42 282 Result for the year -1 387 -1 974

Distributions 100.00 100.00



SALALA RUBBER CORPORATION « SRC » Share Capital: USD 49 656 328 SRC is active in Liberia in the rubber sector.




Concessions: 8 000 hectares Permanent staff as at 31st December 2019: 736



Production (*) (tons) Rubber 2 208 2 342

Turnover (EUR 000) 1 846 1 939

Result (EUR 000) -2 303 -1 882







Equity 6 661 9 238

Debts, provisions and third parties 41 070 37 740

Results for the year -2 577 -2 217

Socfinaf S.A.’s holding (%) 64.91 64.91

(*) Agricultural production fully sold to LAC.


BEREBY-FINANCES « BEFIN » S.A. Share Capital: CFA 8 500 000 000 This Ivory Coast holding company holds 73.16% of SOGB and 70.01% of SCC. SOCIETE DES CAOUTCHOUC DU GRAND BEREBY « SOGB » S.A. Capital: CFA 21 601 840 000 SOGB is active in Ivory Coast in the production and processing of palm oil and rubber.





19 404 4 517 23 921




Production (tons) Rubber 62 678 58 416

Palm oil 38 579 33 152

Turnover (EUR 000) 93 588 86 439

Result (EUR 000) 6 891 4 539


Palm oil 0.53 0.62

Closing rate EUR/CFA 655.957 655.957

Key figures (CFA millions) As at 31st December 2019 2018



Equity (*) 52 875 51 378


Result for the year 4 520 2 977

Distribution 3 024 10 369

Socfinaf S.A.’s indirect holding (%) 63.69 63.69



SUD COMOË CAOUTCHOUC «SCC» Share Capital: CFA 964 160 000 SCC is active in Ivory Coast in the industrial rubber processing sector.

Key data Permanent staff as at 31st December 2019: 391



Production (tons) Rubber 38 233 30 288 Turnover (EUR 000) 44 950 33 654 Result (EUR 000) 4 169 2 525 Average selling price (EUR/kg) Rubber 1.17 1.10 Rate EUR/CFA 655.957 655.957


Fixed assets 4 455 4 867 Current assets 8 189 6 289 Equity (*) 5 925 4 690 Debts, provisions and third parties (*) 6 720 6 466 Result for the year 2 735 1 656 Socfinaf S.A.’s indirect holding (%) 60.95 60.95



PLANTATIONS SOCFINAF GHANA « PSG » Share Capital: GHS 150 000 000 PSG is active in Ghana in the production of palm oil and rubber. Key figures Area (hectares)

Planted area As at 31st December 2019 Mature Immature Total Rubber plantation 0 958 958 Palm plantation 5 013 1 127 6 140

5 013 2 085 7 098


2019 2018

Average rate EUR/GHS 5.87 5.42

Closing rate EUR/GHS 6.22 5.52

Key figures (GHS 000) As at 31st December 2019 2018

Fixed assets 505 333 348 485 Current assets 23 081 13 140 Equity (*) 171 034 111 111 Debts, provisions and third parties (*) 357 380 250 514 Result for the year -43 204 -33 094 Socfinaf S.A.’s holding (%) 100 100



OKOMU OIL PALM COMPANY PLC Share Capital: NGN 476 955 000 Okomu is active in Nigeria in the production and processing of palm oil and rubber. Key figures Area (hectares) Planted area As at 31st December 2019 Mature Immature Total Rubber plantation 5 143 2 192 7 335 Palm plantation 17 178 1 883 19 061

22 321 4 075 26 396




Production (tons) Rubber 7 248 7 536 Palm oil 42 204 39 791 Turnover (EUR 000) 55 045 56 249 Result (EUR 000) 16 255 18 860 Average selling price (EUR/kg) Rubber 1.21 1.08 Palm oil 1.09 1.20 Average rate EUR/NGN 343 360

Closing rate EUR/NGN 344 351

Key figures (NGN 000) As at 31st December 2019 2018

Fixed assets 32 128 678 29 412 385 Current assets 11 068 291 8 992 343 Equity (*) 29 109 408 28 307 192 Debts, provisions and third parties (*) 14 087 561 10 097 535 Result for the year 5 571 766 6 792 213 Distributed profit 4 769 550 2 861 730 Gross dividend per share (NGN) 5.00 3.00 Socfinaf S.A.’s holding (%) 64.97 66.12

(*) Before allocation.


SOCAPALM S.A. Share Capital: CFA 45 757 890 000 Socapalm is active in Cameroon in the production and processing of palm oil and the cultivation of rubber trees.

Key figures Area (hectares) Planted area As at 31st December 2019 Mature Immature Total Palm plantation 30 549 2 036 32 584 Rubber plantation 1 861 206 2 067

32 409 2 242 34 651




Production (tons) Palm oil 140 349 135 641 Rubber 2 442 2 082 Turnover (EUR 000) 106 417 100 594 Result (EUR 000) 18 668 17 370 Average selling price (EUR/kg) Palm oil 0.74 0.73 Rubber 0.93 0.86 Rate EUR/CFA 655.957 655.957


Fixed assets 73 255 74 348 Current assets 22 848 25 542 Equity (*) 74 597 72 602 Debts, provisions and third parties (*) 21 505 27 288 Result for the year 12 245 11 394 Distributed profit 10 250 7 779 Socfinaf S.A.’s holding (%) 67.46 67.46



SOCIETE ANONYME FORESTIERE ET AGRICOLE « SAFA » Share Capital: EUR 4 040 400 This French company owns 68.93% of Safacam S.A. SAFACAM S.A. Capital: CFA 6 210 000 000 Safacam is active in Cameroon in the production and processing of palm oil and the cultivation of rubber trees.

Key figures Surface (hectares) Planted area

As at 31st December 2019 Mature Immature Total Palm plantation 4 995 333 5 328 Rubber plantation 3 154 1 154 4 307

8 149 1 486 9 635

Owned agricultural land : 17 690 hectares Permanent staff as at 31st December 2019: 2 288



Production (tons) Palm oil 16 065 17 053 Palm kernel oil 8 190 7 738 Rubber 7 393 6 524 Turnover (EUR 000) 26 731 25 351 Result (EUR 000) 1 230 872 Average selling price (EUR/kg) Palm Products 1.12 1.07 Rubber 1.18 1.10 Rate EUR/CFA 655.957 655.957


Fixed assets 23 915 24 392 Current assets 7 666 6 025 Equity (*) 19 599 19 363 Debts, provisions and third parties (*) 11 983 11 054 Result for the year 807 572 Distributed profits 571 1 473 Socfinaf S.A.’s indirect holding (%) 69.05 69.05



SOCIETE DES PALMERAIES DE LA FERME SUISSE « SPFS » S.A. Share Capital: CFA 2 601 690 000 SPFS is a 100% subsidiary of Socapalm. SPFS is a palm oil refining company.

Key data Permanent staff as at 31st December 2019: 33

Production and turnovers Realized Realized


Production (tons) Olein 5 500 5 340 Turnover (EUR 000) 8 794 8 347 Result (EUR 000) -133 -451 Average selling price (EUR/kg) Refined packaged oil 1.28 1.41 Refined oil in bulk 1.09 1.05

Rate EUR/CFA 655.957 655.957


Fixed assets 1 307 1 538 Current assets 1 820 2 148 Equity 2 496 2 583 Debts, provisions and third parties 631 1 102 Result for the year -87 -296 Socfinaf S.A.’s indirect holding (%) 67.46 67.46


AGRIPALMA Lda Share Capital: STN 156 094 090 Agripalma is a company active in the production of palm oil on the island of São Tomé and Principe.

Key figures Area (hectares) Planted area



Concessions: 4 917 hectares Permanent staff as at 31st December 2019: 793

2019 2018

Average rate EUR/STN 24.50 24.50

Closing rate EUR/STN 24.50 24.50

Key Figures (STN millions) As at 31st December 2019 2018

Fixed assets 806 750 Current assets 51 28 Equity 123 156 Debts, provisions and third parties 734 622 Result for the year -33 0 Socfinaf S.A.’s indirect holding (%) 88.00 88.00


BRABANTA S.A. Share Capital: CDF 34 243 622 100 Brabanta is a Congolese company (DRC) active in the production of palm oil.

Key data Area (hectares) Concerned area






Production (tons)

Palm oil 16 243 17 841

Turnover (EUR 000) 9 265 11 049

Result (EUR 000) -4 246 -2 404

Average selling price (EUR/kg) Palm oil 0.57 0.62

Average rate EUR/CDF 1 845 1 914

Closing rate EUR/CDF 1 879 1 873

Key figures (CDF millions) As at 31st December 2019 2018

Fixed assets 115 730 121 251


Equity (*) 43 909 51 744


Result for the year -7 834 -4 600




SOGESCOL FR S.A. Share Capital: CHF 5 300 000 Sogescol FR is a Swiss company that sells rubber and palm oil. The fiscal year ends on 31st December 2018 with a profit of USD 7 411 532. The Board of Directors will propose to the General Meeting of Shareholders a profit distribution of USD 7 000 000.

2019 2018




Fixed assets 1 125 865


Equity (*) 16 725 15 313

Debts, provision and third parties (*) 22 912 24 623

Result for the year 7 412 6 338

Detailed result 6 000 8 500

Gross Unit Dividend (USD) 1 132 1 604




SOCFINCO FR S.A. Share Capital: CHF 1 300 000 Socfinco FR is a Swiss company which provides services, studies and management of agro-industrial plantations. Socfinco FR covers the agro-industrial sector of palm oil and rubber. The financial year ended 31st December 2019 shows a profit of EUR 4 227 405. The Board of Directors will not propose any profit distribution.

Key Figures (EUR millions) As at 31st December 2019 2018

Fixed assets 3 911 944 Current assets 10 801 9 764 Equity (*) 9 775 9 548 Debts, provisions and third parties (*) 4 937 1 160 Sales and services 20 876 19 991 The result for the year 4 227 3 745 Distributed results 4 000 6 000 Gross unitary dividend (EUR) 3.077 4.615 Socfinaf S.A.’s holding (%) 50.00 50.00



International Market for Rubber and Palm Oil

1. Rubber


The International Market in 2019 The average price of natural rubber (TSR20 1st position on SGX) was USD 1 406 per ton FOB Singapore in 2019 against USD 1 365 per ton in 2018. Converted in Euro, the average rate in 2019 is EUR 1 256 per ton against EUR 1 155 per ton in 2018, or an increase of EUR 101 per ton. After ending the year 2018 in decline to a level close to USD 1 250 per ton, mainly due to pressure from global stock levels, particularly in China, natural rubber prices started to rise again during the first half of 2019. They evolved around USD 1 500 per ton during the months of April, May and June. Several factors influenced natural rubber prices upwards during the first half of the year, including the start of the winter season for the producing countries and the hope of a positive outcome to the trade dispute between the United States and China. At the same time, Thailand, Indonesia and Malaysia jointly announced their 6th plan to reduce their rubber exports by 240 000 tons. The rise in oil prices also had a positive impact. The highest level of the year was reached at the end of May at USD 1 570 per ton, level which had not been attained since September 2017. In an uncertain macroeconomic context with renewed tensions in Sino-American trade, a continued sustained world production of natural rubber, a slowdown in Chinese growth and a declining automotive sector, prices trend resumed downwards from July onwards. This trend was confirmed during August, September and October, a period during which natural rubber prices regularly moved below the USD 1 300 per ton FOB Singapore. The lowest level of the year was reached at the beginning of October at USD 1 244 per ton. The market recovered at the end of the year following concerns linked to the development of a rubber tree disease affecting several Asian producing countries. At the same time, the prospect of a solution to the trade dispute between the United States and China also gave support to natural rubber prices. Whereas the market expected world natural rubber production to exceed the 14 million tons threshold for the first time in 2019, the IRSG (International Rubber Study Group) now estimates 2019 production at 13.64 million tons, down on the 2018 figure of 13.89 million tons. The IRSG also estimates that world consumption in 2019 will remain stable at around 13.72 million tons compared to 13.76 million tons in 2018. The prices of the TSR20 1st FOB Singapore ended the year at USD 1 451 per ton. Outlook 2020 The prices of natural rubber experienced an upward turn since beginning of the year and has briefly come over USD 1 500 per ton by mid-January. The announcement of a first trade agreement between China and the United States and the approach of the winter season gave the market renewed confidence. The rise in prices suddenly came to end following the emergence of the Coronavirus just before the Chinese New Year. Since then, the Covid-19 outbreak has taken on a global dimension, causing the financial markets to fall, raising fears of a slowdown in global economic growth.


Raw material prices have obviously not been spared. The TSR20 1st FOB Singapore position on SGX went from USD 1 520 per ton in mid-January to USD 1 100 per ton during the month of March. All sectors linked to the automotive industry are suffering the full impact of the crisis. Car and tyre manufacturers are halting and/or sharply reducing production at their factories in Europe, North and South America and elsewhere in the world. It seems that China, after having been the epicentre of the virus, is gradually recovering its production since the end of February. However, the level of production is far from returning back to normal, given the disruptions in supply chains. The impact of Covid-19 on world consumption of natural rubber will be profound in the coming months. The evolution of world natural rubber production is also uncertain. The low-price levels over the last 5 years did not encourage small planters to bleed and maintain their plantation. The recent fall in prices will only worsen this situation. In addition, the development of Covid-19 in some producing regions could also have an impact on world natural rubber production. The coming months are likely to be complicated particularly in terms of demand. The TSR20 1st position FOB Singapore on SGX quoted on 27th March 2020 was USD 1 070 per ton, a level which had never been attained since February 2016.

2. Palm oil


World palm oil production in millions of tons (source: Oil World)

2020(*) 2019(*) 2018 2017 2016 2015 2005 1995

Indonesia 44.7 43.3 41.6 36.8 32.1 33.4 14.1 4.2 Malaysia 19.9 20.0 19.5 19.9 17.3 20.0 15.0 7.8 Others 12.8 12.4 11.9 11.2 9.5 9.1 4.8 3.2 TOTAL 77.4 75.7 73.0 67.9 58.9 62.5 33.9 15.2

(*) Estimation.

Production of main oils in millions of tons (source: Oil World)

Oct 2019 to Sept

2020 (*) 2019(*) 2018 2017 2016 2015 2005 1995

Palm 76.3 75.7 73.0 67.9 58.9 62.5 33.9 15.2

Soy 57.6 56.6 56.8 53.9 51.5 48.8 33.6 20.2 Rapeseed 25.0 25.1 25.6 25.4 25.0 26.3 16.2 10.8

Sunflower 20.9 20.5 19.0 19.0 16.4 15.1 9.7 8.7 Cotton 4.7 4.6 4.7 4.2 4.1 4.7 5.0 3.9

Peanut 3.9 3.7 4.0 4.2 3.7 3.7 4.5 4.3

Palm-kernel 8.2 8.0 7.7 7.2 6.4 6.8 4.0 2.0 Coconut 2.7 2.9 2.9 2.4 2.7 2.9 3.2 3.3

TOTAL 199.3 197.1 193.7 184.2 168.7 170.8 110.1 68.4

(*) Estimation.


International Market 2019 The average price of CIF Rotterdam crude palm oil in 2019 is USD 566 per ton against USD 598 per ton in 2018.This is the lowest annual average price since 2016. World prices slumped in 2018 as a result of a robust supply on the market. While traded at levels close to USD 700 per ton at the beginning of the year, crude palm oil prices fell in the second half to USD 500 per ton CIF Rotterdam, in an uncertain macroeconomic context, marked by historically high global stock levels. At the beginning of 2019, the slowdown in production and the increase in consumption in India and China led to a drop in stocks, which allowed a brief recovery in palm oil prices, which reached USD 570 per ton CIF Rotterdam in mid-February. At the same time, the rise in oil prices encouraged an increase in palm oil consumption for biodiesel production in Indonesia in particular. However, despite this encouraging news, negative sentiment dominated the markets and palm oil prices CIF Rotterdam fell below USD 500 ton on several occasions during May, June and July. World vegetable oil stocks remained at high levels and the decline in palm oil stocks was considered insufficient to justify a sustained recovery in prices. At the same time, the uncertainties related to the outcome of the trade war between the United States and China caused major disruptions in most commodity markets. Soybean prices, which were particularly affected, fell to levels not seen since the financial crisis of 2008, dragging palm oil prices down in their wake. Palm oil prices started to rise again in August and rose sharply throughout the last quarter to close 2019 at around USD 850 per ton CIF Rotterdam, an increase of almost 70% in 5 months. This rise in prices is largely linked to the announcements made by Malaysia and Indonesia to increase their consumption of palm oil for the manufacturing of biodiesel as from 2020 (B20 in Malaysia and B30 in Indonesia). These announcements sent a very strong signal to the market and coincided with a slowdown in supply in the producing countries. Fewer fertilisers due to prolonged low prices and dry weather caused by a possible return of the El Niño climate phenomenon have raised fears of a possible drop in production in the coming months and, consequently, a significant drop in stock levels. The Sino-American trade war also had an impact on the palm oil market in the last quarter. China, deprived of American soybeans, began to buy more palm oil, with Beijing exempting this product from quotas to facilitate imports before the Chinese New Year. At the end of the year 2019, CIF Rotterdam crude palm oil prices were around USD 850 per ton. Outlook 2020 The rise in prices came to a halt in mid-January. Palm oil has since entered a downward spiral caused by two major causes:

• The announcement by India, the world's largest palm oil importer, to boycott palm oil imports from Malaysia. This decision comes in retaliation for the Malaysian government's criticism to Indian government's action in the Kashmir region.

• Concerns about the spread of the Coronavirus in China and the rest of the world. Indeed, the risk of a slowdown in world growth, and more particularly in Chinese growth, the world's second largest importer of palm oil, is weighing heavily on prices.


On 28th January, palm oil plunged 10% on the Kuala Lumpur Stock Exchange, posting its biggest single day drop in nearly 11 years. Trapped in a downward whirlwind throughout February, palm oil fell back under the USD 700 per ton CIF Rotterdam threshold. However, and excluding the "Coronavirus" factor, the fundamentals for palm oil remain solid. According to Oil World, world palm oil production, after having increased by almost 9 million tons in 2017, then by 5 million tons in 2018, would only have increased by 2.7 million tons in 2019. Oil World estimated before the Covid-19 crisis that the increase in palm production in 2020 would be less than 2 million tons. We are indeed seeing a slowdown in the increase in production in the two main producing countries, Indonesia and Malaysia (85% of world production) which have less available land to produce and sometimes face problems of labour availability. In addition, the severe drop in palm oil prices over the last two years has led to a reduction in the use of fertilizers in village plantations, which is likely to reduce yields. In 2020, world palm oil production is expected to reach 77 million tons, of which nearly 45 million tons will be produced in Indonesia. Palm oil production therefore continues to increase but in proportions that may be insufficient to meet the growth in global demand. The latter remains particularly sustained thanks to the increase in world population and the continuing rise in demand for vegetable oil in developing countries. The expected decline in stocks should therefore logically favour a rebound in palm oil prices. However, this will depend heavily on the evolution of the Coronavirus crisis in the coming months. From China, the epidemic is now spreading to the rest of the world, impacting the entire global economy in its wake. With nearly a third of the world's population in lockdown and entire sectors of the economy shut down, demand for palm oil could slow down in the coming months. Production could also be impacted if the contagion spreads to producing countries, which seems to be the case with the recent closure of some plantations in Malaysia. Oil prices have also collapsed in recent weeks. Brent crude oil, which was trading at around USD 70 per barrel at the beginning of January, is now trading below USD 30 per barrel. The fall in oil prices could lead to a sharp drop in biodiesel production worldwide and thwart plans by the Malaysian and Indonesian governments who were betting on a significant increase of palm oil use for the making of biodiesel. In 2019, it is estimated that biodiesel will account for a global demand for palm oil estimated at more than 17.5 million tons or about 23% of global production, of which more than 4 million tons for Europe (EU28). The price of crude palm oil CIF Rotterdam quoted on 27th March 2020 was around USD 620 per ton.


Environment and Social Responsibility On 22nd March 2017, the Group adopted its new policy on corporate responsibility. It is based on the four principles of responsible development, improvement of management practices, respect for human rights and transparency. An implementation plan for this policy has been defined and executed throughout the 2019 financial year. The efforts and actions undertaken by the Socfin Group in this area are detailed in a dashboard regularly updated as well as in a separate annual report ("Sustainable Development Report"). The corporate responsibility policy, the dashboard and the annual sustainable development report are available on the Group's website. The annual sustainability report is also available from the Company's head office upon request.


Key Figures

1. Activity indicators

Area (hectares) Rubber Palm

As at 31st December 2019 Immature (by year of planting) 2019 1 373 199

2018 2 189 3 347

2017 1 909 1 851

2016 1 479 0

2015 1 829 0

2014 2 935 0

2013 1 390 0

2012 642 0

2011 114 0

Total immature 13 860 5 396

Young (8 to 11 years) 15 869 (4 to 7 years) 42 167

Mature (12 to 22 years) 9 979 (8 to 18 years) 22 110

Old (above 22 years) 8 653 (above 18 years) 21 547

Total in production 34 501 85 824

TOTAL 48 361 91 220

Area (hectares) 2019 2018 2017 2016 2015

Palm plantation 91 220 91 099 88 994 85 925 82 134

Rubber plantation 48 361 48 071 47 890 48 273 49 427

TOTAL 139 581 139 170 136 884 134 198 131 561 Production 2019 2018 2017 2016 2015

Palm oil (tons) Own production 244 551 231 522 210 927 174 765 163 805

Third party purchases 34 428 30 554 24 730 20 626 21 084

Rubber (tons) Own production 53 749 47 753 48 672 45 004 50 553

Third party purchases 94 102 81 920 66 297 65 050 58 543 Turnover (EUR 000) 2019 2018 2017 2016 2015

Palm 209.9 206.1 191.7 168.2 151.2

Rubber 163.5 135.4 155.0 119.3 121.1

Others 2.8 3.1 3.0 3.4 3.9

TOTAL 376.1 344.6 349.8 290.9 276.2 Staff 2019 2018 2017 2016 2015

Average workforce 24 166 22 707 22 113 19 154 20 544


2. Key figures from the consolidated income statement and the cash flow

statement

(EUR millions) 2019 2018 2017 2016 2015

Turnover 376 345 350 291 276

Operating income 46 42 75 36 6

Result for the year attributable to the Group

2 5 22 5 -18

Operating cash flow 65 91 123 51 143

Free cash flow * 9 6 44 -30 19

* Free Cash Flow = Cash flow from operating activities + cash flow from investing activities.

3. Key figures from the consolidated statement of financial position

(EUR millions) 2019 2018 2017 2016 2015

Bearer biological assets 402 402 379 387 377 Other non-current assets 304 301 280 291 309 Current assets 169 140 128 134 146 Total equity 383 383 371 400 425 Non-current liabilities 194 137 151 161 137 Current liabilities 298 323 265 251 269

Stock market data

(EUR) 2019 2018 2017 2016 2015

Number of shares 17 836 650 17 836 650 17 836 650 17 836 650 17 854 200

Equity attributable to the Group 270 919 731 273 289 987 263 538 857 296 419 644 320 416 764

Consolidated net earnings per share attributable to the Group

0.09 0.27 1.23 0.30 -0.98

Dividend per share 0.00 0.10 0.10 0.10 0.00 Share price minimum 8.20 10.90 15.61 11.76 13.55

maximum 12.20 16.90 19.75 15.85 18.00

closing 12.00 11.40 16.10 15.61 15.00

Market capitalization * 214 039 800 203 337 810 287 170 065 278 430 107 267 813 000

Dividends paid / consolidated net profit

n/a 37.44% 8.13% 33.33% n/a

Dividends / market capitalization

n/a 0.88% 0.62% 0.64% n/a

Share price / net profit per share

135.65 42.68 13.09 52.03 -15.31

* Market capitalization is the product of the number of shares multiplied by the closing market price.

Financial highlights of the year

• Sale of 10 910 810 Okumu shares.


Corporate governance statement

1. Introduction

Socfinaf S.A. pays close attention to the evolution of the ten principles of corporate governance of the Luxembourg Stock Exchange. It commits to provide the necessary explanations for a comprehensive understanding on how the Company functions. Corporate governance is a set of principles and rules whose main objective is to contribute to long-term value creation. It allows the Board to promote the interests of the Company and its shareholders by the implementation of an effective control systems for risk management and conflicts of interest.

2. Corporate Governance charter

The Board of Directors adopted the corporate governance charter on 21st November 2018. It is available on the Group's website.

3. Board of Directors

Composition of the Board of Directors

Name Nationality Year of Birth

Position First nomination

Term of office

Mr. Hubert Fabri Belgian 1952 Chairman (a) AGM 1981 AGM 2022

Mr. Vincent Bolloré French 1952 Director (a) AGM 1993 AGM 2023

Mr. Philippe de Traux Belgian 1951 Director (b) and General secretary

AGM 1997 AGM 2021

Bolloré Participations represented by Mr. Cyrille Bolloré

French

1985

Director (a)

AGM 2018

AGM 2024

Administration and Finance Corporation «AFICO» represented by Mr. Jean-Charles de Fauconval

Belgian

1959

Director (a)

AGM 1998

AGM 2020

Mr. Luc Boedt Belgian 1955 Director (b) AGM 2007 AGM 2025

Mr. Fulgence Koffy Ivorian 1935 Director (a) AGM 2011 AGM 2023

Mr. Gbenga Oyebode Nigerian 1959 Director (a) AGM 2011 AGM 2023

Mr. François Fabri Belgian 1984 Director (b) AGM 2014 AGM 2020

Mr. Pierre Lemaire Belgian 1970 Director (c) AGM 2019 AGM 2025

(a) Non-Executive Dependent Director (b) Executive Dependent Director (c) Independent Director


The term served as director by Administration and Finance Corporation "AFICO" expires this year. It will be proposed at the next Annual General Meeting not to renew this mandate. In addition, the term served as director by Mr François Fabri expires this year. It will be proposed at the Annual General Meeting to appoint Mr. François Fabri as Executive Director of the Company for a term of six years, expiring at the Annual General Meeting in 2026. In addition, the Board will propose to the next Annual General Meeting the appointment of Mr Philippe Fabri as an additional Director for a term of six years, expiring at the Annual General Meeting in 2026. Other mandates held by the Directors in listed companies Hubert Fabri Chairman Positions and offices held in Luxembourg companies

• Chairman and director of the Board of Directors of Société Financière des Caoutchoucs "Socfin", Socfinaf and Socfinasia.

Positions and offices held in foreign companies

• Chairman and Director of the Board of Directors of Palmeraies de Mopoli;

• Vice-Chairman of Société des Caoutchoucs du Grand Bereby "SOGB";

• Vice-Chairman and member of the Supervisory Board of Compagnie du Cambodge;

• Director of Bolloré, Financière Moncey, Okomu Oil Palm Company, S.A.F.A. Cameroon "Safacam", Société Industrielle et Financière de l’Artois and La Forestière Equatoriale;

• Permanent representative of Administration and Finance Corporation "AFICO" at the Board of Société Camerounaise de Palmeraies "Socapalm".

Vincent Bolloré Director Positions and offices held in Luxembourg companies Director of Société Financière des Caoutchoucs "Socfin", Socfinaf and Socfinasia.


• Chairman and CEO of Bolloré;

• Chairman of the Board of Directors (Separate Management) of Financière de l'Odet and Blue Solutions;

• Vice-Chairman of Société des Caoutchoucs du Grand Bereby "SOGB”;

• Member of the Supervisory Board of Vivendi;

• Director of Bolloré, Financière Moncey, Financière de l'Odet and Blue Solutions ;

• Permanent representative of Bolloré Participations on the Boards of Directors of Société Industrielle et Financière de l'Artois, S.A.F.A. Cameroon "Safacam", Société des Caoutchoucs du Grand Bereby "SOGB" and Société Camerounaise de Palmeraies "Socapalm";

• Permanent representative of Bolloré Participations on the Supervisory Board of Compagnie du Cambodge.

Philippe de Traux Director Positions and offices held in Luxembourg companies

• Director and General Secretary of Société Financière des Caoutchoucs "Socfin", Socfinaf and Socfinasia.



• Director of Palmeraies de Mopoli, Okomu Oil Palm Company, Société des Caoutchoucs du Grand Bereby « SOGB » and Société Camerounaise de Palmeraies « Socapalm »;

• Permanent representative of Administration and Finance Corporation « AFICO » on the Board of Société Industrielle et Financière de l’Artois;

• Permanent representative of Société Anonyme Forestière et Agricole « SAFA » on the board of S.A.F.A. Cameroun « Safacam ».

Bolloré Participations Director Positions and offices held in Luxembourg companies

• Director of Société Financière des Caoutchoucs "Socfin", Socfinaf and Socfinasia.


• Member of the Supervisory Board of Compagnie du Cambodia;

• Director of Bolloré, Compagnie des Tramways de Rouen, Financière de l'Odet, Société des Chemins de Fer et Tramways du Var et du Gard, Société des Caoutchoucs du Grand Bereby "SOGB", Société Industrielle et Financière de Artois, S.A.F.A. Cameroon "Safacam" and Société Camerounaise de Palmeraies "Socapalm".

Administration and Finance Corporation « AFICO » Director Positions and offices held in Luxembourg companies

• Director of Société Financière des Caoutchoucs "Socfin", Socfinaf and Socfinasia.


• Director of Palmeraies de Mopoli, Société des Caoutchoucs du Grand Bereby « SOGB », Société Industrielle et Financière de l’Artois and Société Camerounaise de Palmeraies « Socapalm ».

Luc Boedt Director Positions and offices held in Luxembourg companies

• Director of Socfinaf et Socfinasia;

• Permanent representative of Administration and Finance Corporation «AFICO» on the board of directors of Société Financière des Caoutchoucs «Socfin».


• Chairman of S.A.F.A. Cameroun «Safacam»;

• Director of Okomu Oil Palm Company and Société des Caoutchoucs du Grand Bereby «SOGB»;

• Permanent representative Socfinaf on the Board of Directors of Société Camerounaise de Palmeraies « Socapalm ».

Fulgence Koffy Director Positions and offices held in Luxembourg companies

• Director of Socfinaf.


• Director of Société des Caoutchoucs du Grand Bereby « SOGB ».


Gbenga Oyebode Director Positions and offices held in Luxembourg companies



• Chairman of Okomu Oil Palm Company.

• Director of Nestlé Nigeria. François Fabri Director Positions and offices held in Luxembourg companies

• Director of Société Financière des Caoutchoucs "Socfin", Socfinaf and Socfinasia. Positions and offices held in foreign companies

• Permanent Representative of Administration and Finance Corporation "AFICO" on the Board of Société des Caoutchoucs du Grand Bereby "SOGB";

• Director of S.A.F.A. Cameroon "Safacam" and Société Camerounaise de Palmeraies "Socapalm".

Frédéric Lemaire Director Positions and offices held in Luxembourg companies


Appointments of Directors The Board of Directors proposes the appointment of the Directors at the Annual General Meeting of shareholders. It specifies the term of service and verifies that the Director meets the criteria for independence. In the event of a vacancy due to death or following the resignation of one or more Directors, the remaining Directors will proceed to temporary co-optations. These co-optations will be subject to the approval of the Annual General Meeting of shareholders at its next meeting. The director appointed to replace another director will complete the term of his predecessor. Role and powers of the Board of Directors The Board of Directors is the body which is responsible for the management of the Company and the control of day-to-day management. It acts in the interest of the Company. The Board of Directors ensures that all financial and human resources are available and ensures that all the necessary structures are in place to achieve its objectives and ensure long-term value creation. The Company's by-laws confer on the Board of Directors the power to perform all acts necessary to achieve the corporate purpose.


Activity report of the meetings of the Board of Directors Number of annual meetings At least two for the year-end and mid-year evaluations. During the 2019 financial year, the Board of Directors met 3 times. Points generally discussed Periodic accounting situations; Portfolio movements; Inventory and valuation of the portfolio; Evolution of significant holdings; Management report; Investment projects; Corporate, social and environmental responsibility. Average attendance rate of Directors - 2019: 71% - 2018: 84% - 2017: 78% - 2016: 81% - 2015: 83%

4. Committees of the Board of Directors

4.1. Audit Committee

The Committee is composed of two members. The term of service is for one year and the members are eligible for re-election. At its meeting of 18th March 2020, the Board of Directors appointed Mr Hubert Fabri and Mr Frederic Lemaire as members of the Audit Committee. The Audit Committee will assist the Board of Directors in its supervisory function and decide on matters relating to financial information for shareholders and third parties, the audit process, risk analysis and control. The Audit Committee shall meet twice a year.

4.2. Appointment and Remuneration Committee

The remuneration of the operational management of Socfinaf S.A is set by the principal shareholders. The Board of Directors does not consider it necessary to set up a Remuneration Committee. Similarly, for practical reasons and due to the size of the Company, the Board of Directors has not chosen to set up a Nomination Committee.

5. Remuneration

The remuneration allocated to the members of the Board of Directors of Socfinaf S.A. for the financial year 2019 amounts to EUR 982 916 compared to EUR 1 068 805 for the financial year 2018. The Directors of Socfinaf S.A. did not receive any other payment in shares (stock options).


6. Shareholding status

On 31st December 2014, Socfinaf S.A. issued 1 474 200 new shares which brings to a total of 17 854 200 number of shares issued. All statements filed between 1st July 2011 and 31st December 2014 relate to the previous number of shares in place and the previous number of voting rights, i.e. 16 380 000.

Shareholder Number of shares held =

Number of voting rights

Percentage holding

Date of notification

Socfin L-1650 Luxembourg 10 497 046 58.85 01/02/2017

Bolloré (a) F-29500 Ergué Gaberic

80 642 0.49 (b) 03/09/2014

Compagnie du Cambodge (a) F-92800 Puteaux

1 157 929 7.07 (b) 03/09/2014

Société Industrielle et Financière de l’Artois (a) F-92800 Puteaux

176 636 1.08 (b) 03/09/2014

Compagnie des Glénans (a) F-29500 Ergué Gaberic

58 993 0.36 (b) 03/09/2014

Total Bolloré (all categories combined, based on aggregate voting rights)

1 474 200 9.00 (b)

(a) = entities controlled by Vincent Bolloré. (b) = before increase in share capital on 31st December 2014

7. Financial calendar

26th May 2020 Ordinary Annual General Meeting at 10 a.m. End-September 2020 Consolidated half yearly results as at 30th June 2020 Mid-November 2020 Interim statement of the Board for Q3 2020 End of March 2021 Annual results of the holding company as at 31st December 2020 Mid-April 2021 Consolidated Annual Results as at 31st December 2020 Mid-May 2021 Interim Statement of the Board for Q1 2021 25th May 2021 Ordinary Annual General Meeting at 10 a.m.

The results of the Company are published on the website of the Luxembourg Stock Exchange www.bourse.lu under the heading "OAM" and on the website of the Company www.socfin.com.

http://www.socfin.com/


8. External Audit

Independent statutory auditor (Réviseur d’entreprises agréé) C – CLERC S.A. 1 rue Pletzer, L-8080 Bertrange. In 2019, the audit fees amount to EUR 281 015, VAT included. The audit fees include all fees paid to the independent statutory auditor of the Group (C-Clerc S.A., member of Crowe Global network) as well as those paid to member firms within their network for the year. No consulting work or other non-audit services have been performed by those companies in 2019 or in 2018. The mandate of the independent statutory auditor C-CLERC expires this year. The audit committee should receive some other proposals and will submit their recommendation to the Annual General Meeting.

9. Corporate, social and environmental responsibility

On 22nd March 2017, the Group adopted its new responsible management policy. It is based on the four principles of responsible development, improvement of management practices, respect for human rights and transparency. An implementation plan for this policy has been defined and executed throughout the 2019 financial year. The efforts and actions undertaken by the Socfin Group in this area are detailed in a dashboard regularly updated as well as in a separate annual report ("Sustainable Development Report"). The responsible management policy, the dashboard and the annual sustainable development report are available on the Group's website.

10. Other information

Pursuant to the Regulation 2016/347 of the European Commission of 10th March 2016 specifying the modalities for updating insider lists, a list of insiders has been drawn up and is kept continuously up to date. The persons concerned have been informed of their inclusion on this list.


Statement of Compliance Mr. Philippe de Traux, Director and Mr. Daniel Haas, Chief Financial Officer, indicate that, to their knowledge: (a) the financial statements prepared in accordance with the applicable accounting standards

provide a true and fair view of the assets and liabilities, the financial position and the profits or losses attributable to the Group and all of the entities included in consolidation and;

(b) the management report fairly presents the evolution and results of the Company, the

financial position of the Group and all the entities included in the consolidation and a description of the main risks and uncertainties they face.


Consolidated management report

Directors’ Report on the Consolidated Financial Statements presented by the Board of Directors to the

Ordinary Annual General Meeting of the Shareholders of 26th May 2020

Ladies and Gentlemen, CONSOLIDATED FINANCIAL STATEMENTS The consolidated financial statements as at 31st December 2019 comprise the financial statements of Socfinaf S.A., all subsidiaries and direct and indirect associate companies, the details of which are given in Note 2 of the Notes to the consolidated financial statements. As indicated in Note 1 of the notes to the consolidated financial statements, the consolidated financial statements have been prepared in accordance with International Financial Reporting Standards or IFRS as adopted by the European Union. Socfinaf S.A. (the Group) adopted IFRS standards for the first time in 2005 and all the standards applicable to the Group as at 31st December 2019 have been implemented. Consolidated results For the 2019 financial year, the result attributable to the Group amounted to EUR 1.6 million compared to EUR 4.8 million in 2018. This results in earnings per share of EUR 0.09 compared to EUR 0.27 in 2018. Consolidated revenue amounted to EUR 376.1 million in 2019 compared to EUR 344.6 million in 2018 (increase of EUR 31.5 million). This increase in revenue is mainly due to the increase in quantities sold. Likewise, the operating profit increased to EUR 46.5 million, compared to EUR 42.3 million in 2018. Other financial income decreased to EUR 2.9 million compared to EUR 4.5 million in 2018 and consisted mainly of foreign exchange gains of EUR 2.4 million compared to EUR 3.2 million in 2018. Financial expenses amounted to EUR 16.7 million compared to EUR 14.7 million in 2018 and consisted mainly of interest expense of EUR 12.3 million (EUR 10.9 million in 2018) and foreign exchange losses of EUR 3.1 million (EUR 2.7 million in 2018). The tax expense increased. Income taxes amounted to EUR 23.9 million euros compared to EUR 18.3 million in 2018. Profit for the year from associates attributable to the Group increased to EUR 5.8 million compared to EUR 4.9 million in 2018. Consolidated statement of financial position The assets of Socfinaf S.A. consist of:

- Non-current assets of EUR 705.8 million compared to EUR 703 million in 2018. The adoption of IFRS 16 contributed to the accounting of EUR 7.2 million of right-of-use asset.

- current assets amounted to EUR 169.3 million compared to EUR 140.2 million in 2018.


The value of inventory increased by EUR 20.8 million. Cash flows also increased by EUR 4.4 million. Shareholders’ equity amounted to EUR 270.9 million compared to EUR 273.3 million in 2018. This decrease in shareholder’s equity of EUR 2.4 million was mainly due to the change in the translation reserve (EUR -2.7 million) and in the profit for the year (EUR +1.6 million) On the basis of consolidated shareholders' equity, the net value per share attributable to the Group was EUR 15.19 compared to EUR 15.32 a year earlier. As at 31st December 2019, the share price stood at EUR 12.00. Current and non-current liabilities increased to EUR 491.9 million compared to EUR 460.1 million a year earlier. This change was mainly due to the accounting of EUR 9 million of leases liabilities generated upon implementation of IFRS 16. Financial debts increased to EUR 235 million in 2019 compared to EUR 214 million in 2018. This mainly consist of loans to Socfinaf SA from Socfin for EUR 126.3 million as well as the advances from subsidiaries for an amount of EUR 108.7 million. Deferred tax liabilities decreased to EUR 9.1 million compared to EUR 9.7 million in 2018 while current tax liabilities decreased to EUR 18.5 million compared to EUR 19.7 million in 2018. Other liabilities include short-term advances from shareholders amounted to EUR 40.4 million as well as cash pooling advances of EUR 100.5 million. Consolidated cash flows As at 31st December 2019, net cash flows amounted to EUR 28.9 million, an increase of EUR 33.1 million for the year compared to a decrease of EUR 11.6 million in the previous financial year. Net cash flow from operating activities amounted to EUR 64.8 million during the financial year 2019 (EUR 91.3 million in 2018). It resulted mainly from self-financing capacity of EUR 87.7 million (EUR 89 million in 2018), offset by EUR 6.5 million increase in inventories and EUR 5.7 increase in trade and other receivables. Net cash flow from investing activities amounted to EUR 56.2 million (EUR 84.9 million in 2018). These activities are largely influenced by acquisitions of tangible fixed assets amounting to EUR 57.1 million (EUR 88.1 million in 2018). Cash flow from financing activities generated EUR 24.3 million (EUR -18.5 million in 2018) OUTLOOK FOR 2020 The results for the next financial year will depend to a large extent on factors external to the management of the Group, namely the political and economic conditions in the countries where the subsidiaries are established, the development of the price of rubber and palm oil and the evolution of the US dollar against the euro. The Group, for its part, pursues its policy of keeping cost prices as low as possible and improving its production capacity. POLITICAL AND ECONOMIC ENVIRONMENT The Company holds interests in subsidiaries operating in Africa. Given the economic and political instability in some of the African countries (Sierra Leone, Liberia, Ivory Coast, Ghana, Nigeria, Cameroon, São Tomé and DRC), these holdings present a risk in terms of exposure to political and economic changes.


EVENTS AFTER THE REPORTING DATE The Covid-19 epidemic began in China in December 2019 and spread to the rest of the world from January 2020 and raised to “pandemic” status on 11th March 2020 by the WHO. At the balance sheet date, the epidemic had no impact on the Group's activities. The Covid-19 epidemic, which took a global dimension, caused the financial markets to fall dramatically from mid-February onwards, raising fears of a slowdown in global economic growth. Raw material prices were obviously not spared. Thus, the TSR20 1st position FOB Singapore on SGX quoted on 27th March 2020 at USD 1 070 per ton, against USD 1 451 per ton on 31st December 2019. Similarly, the price of crude palm oil CIF Rotterdam closed on 27th March 2020 at around USD 620 per ton, against USD 850 per ton on 31st December 2019. The Covid-19 crisis has strongly affected sectors linked to the Chinese economy, particularly groups operating in the automotive industry, already in slowdown. In addition, tyre manufacturers are in the process of halting or drastically reducing production at most of their factories in Europe, North America, South America and elsewhere in the world. We expect a sharp decline in rubber demand from tyre manufacturers from April onwards. Slower growth in China and the recent lockdown in India, the two major palm oil importers, and falling oil prices are also weighing heavily on current crude palm oil prices. The situation is being closely monitored by the management teams. However, it is too early to assess the full impact of the Covid-19 epidemic on the financial year 2020. First quarter operations were not affected by this crisis. Moreover, 70% of palm oil is sold locally on markets that offer a price which is sustainably higher than the world market price CORPORATE GOVERNANCE The Board of Directors implements the corporate governance rules applicable in the Grand Duchy of Luxembourg in the Group's financial structure and reports. GENERAL INTERNAL CONTROL SYSTEM ADAPTED TO THE SPECIFICICATIONS OF THE GROUP'S ACTIVITIES Separation of functions The separation of operational, commercial and financial functions implemented at each level of the Group reinforces the independence of internal control. These different functions ensure the completeness and reliability of the information which is within their areas of responsibility. They provide regular updates of the completeness of information to local managers and to the Group’s headquarters (agricultural and industrial production, trade, human resources, finance, etc) Autonomy and accountability of subsidiaries The operational entities enjoy a large degree of autonomy in their management due to geographical distances. They are in particular responsible for the implementation of an internal control system adapted to the nature and extent of their activity, the optimisation of their operations and financial performances, the protection of their assets and management of their risks. This autonomy makes it possible for the entities to be more accountable and to ensure the adequacy between their practices and the legal framework of their host country.


Centralised control The Human Resources Management policy of the top management of the entities within the Group is centralized at the Group's headquarters. It contributes to the smooth running of an effective internal control system through the independence of recruitment, the harmonization of the segregated functions, annual evaluations and training programs. The operational, commercial and financial functions centrally define a set of standard reports which ensure the homogeneity of the presentation of information originating from the subsidiaries. Treasury reporting process The treasury department organises, supervises and controls the reporting of daily information and weekly indicators of the subsidiaries, in particular the cash flow position, the evolution of net debt and the expenses related to the investments. Financial reporting process The financial department organises, supervises and controls the reporting of monthly accounting, budgetary and financial information and distributes condensed reports for use by the Group's operational management. Twice per year, it includes this information in the long-term development plan of the subsidiaries. It also ensures the implementation of the financial decisions taken by the Board of Directors of the subsidiaries. Preparation of consolidated accounts The consolidated financial statements are prepared on a half-yearly basis. They are audited annually by the external auditors as part of a financial audit of subsidiaries, which covers both the statutory accounts of the entities in the scope of consolidation and the consolidated financial statements. Once approved by the Board of Directors, they are published. The consolidation department of the Group guarantees homogeneity and treatment monitoring for all companies within the scope of consolidation. It strictly adheres to the accounting standards in force relating to consolidation operations. It uses a standard consolidation tool to ensure the secure processing of information feedback from subsidiaries, the transparency and relevance of automatic consolidation processes and the consistency of presentation of accounting aggregates in the annual report. Lastly, due to the complexity of the accounting standards in force and the many specificities related to their implementation, the consolidation service centralises the adjustments specific to the valuation rules applicable to the consolidated financial statements. ENVIRONMENT AND SOCIAL RESPONSIBILITY The Group has published its responsible management policy in 2017. It is based on the four principles of responsible development, improvement of management practices, respect for human rights and transparency. The efforts and actions undertaken by the Socfin Group in this area are detailed in a dashboard regularly updated as well as in a separate annual report ("Sustainable Development Report"). The responsible management policy, the dashboard and the annual sustainable development report are available on the Group's website

The Board of Directors


Audit report on the consolidated financial statements To the Shareholders SOCFINAF S.A. 4, avenue Guillaume L-1650 Luxembourg REPORT OF THE RÉVISEUR D’ENTREPRISES AGRÉÉ Report on the audit of the consolidated financial statements Opinion We have audited the consolidated financial statements of SOCFINAF S.A. and its subsidiaries (the "Group") including the consolidated statement of financial position as at 31st December 2019 and the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of cash flows and the consolidated statement of changes in equity for the year then ended, and the notes to the consolidated financial statements, including a summary of significant accounting policies. In our opinion, the accompanying consolidated financial statements give a true and fair view of the Group's consolidated financial position as at 31st December 2019, as well as its consolidated financial performance and consolidated cash flows for the year then ended, in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. Emphasis of matter Without qualifying our opinion, we would like to draw your attention to the following points: Note 1.13 to the consolidated financial statements describes that the Group has adopted IFRS 16 "Leases" as of 1st January 2019 using the modified retrospective transition approach. According to note 35, the scope of consolidation includes investments whose operating companies are located in various countries in Africa and Southeast Asia and which are exposed to risks of political and economic fluctuations Basis of opinion We conducted our audit in accordance with the Regulation (EU) N ° 537/2014, the law of 23rd July 2016 relating to the audit profession (the law of 23rd July 2016) and the international auditing standards (ISA ) as adopted for Luxembourg by the Commission de Surveillance du Secteur Financier (CSSF). The responsibilities incumbent on us under these regulations, laws and standards are more fully described in the section entitled "Auditors’ Responsibilities " for the audit of the consolidated) fully described in the section entitled "Auditors’ Responsibilities " for the audit of the consolidated financial statements of this report. We are also independent from the Group in accordance with the code of ethics of professional accountants – the International Standards of Accounting Ethics (the IESBA Code) as adopted for Luxembourg by the CSSF as well as the rules of professional conduct which apply to the audit of the consolidated financial statements and we have fulfilled the other responsibilities imposed on us under these rules. We believe that the audit evidence we have gathered is sufficient and appropriate to provide a basis for our audit opinion.


Key Audit matter The key audit questions are those matters that, in our professional judgment, have been the most significant in the audit of the consolidated financial statements for the period. These matters have been addressed in the context of our audit of the consolidated financial statements as a whole and for the purpose of forming our opinion thereon, and we do not express a separate opinion on these matters. Impairment losses on biological assets Description of the key audit matter At 31st December 2019, the value of the Group's biological production assets amounted to EUR 402 million for a total balance sheet of EUR 875 million. The Group has biological assets in Africa. These biological assets, mainly consisting of palm oil and rubber plantations, are valued according to the principles defined in IAS 16 "Property, plant and equipment ". Biological assets are recorded at acquisition cost less accumulated amortization and any impairment losses. Note 24 "Impairment of assets" in the notes to the consolidated financial statements describes the methods used by the Group to verify whether there is an indication of impairment at the end of the reporting period and when an impairment occurs, the methods for determining the recoverable value of the biological assets on the basis of which an impairment loss may be recognized. The impairment loss index adopted by the Group is a decline in prices of natural rubber (TSR20 first position on SGX) and crude palm oil (CIF Rotterdam) at the closing date of more than 15% compared to an average of values over 5 years. The Group also compares the 6-month average as well as the average over the last 12 months of these courses to the average of these same values over 5 years. The Group also studies the prices observed on local markets, considering that a fall in these prices at the closing date of more than 15% compared to an average of values over 5 years constitutes an indication of loss of value. In addition to these external factors, the Group considers the following factors:

- Internal performance indicators; - Conditions of the local market; - Physical indicators of loss of value; - Significant change in plantation, which could have a material impact on their future cash

flows. The recoverable amount is the higher of value in use and market value. Value in use is determined by reference to discounted net future cash flows and involves significant management judgment, particularly in the preparation of forecasts and the choice of discount rates. We considered that the value of the biological assets is a key audit issue due to their significant amount in the consolidated statement of financial position and because the assessment of the existence of a loss of the value and, if applicable, the determination of the recoverable value of the assets, is judgmental. Audit response provided To address this risk, we have implemented the following works:

- Assess the compliance of the methodology applied by the Group with the provisions of IAS 36


"Impairment of Assets"; - Perform a critical analysis of the methods used to implement this methodology, paying

particular attention to any indications of impairment; - Review the work of the auditors of the significant subsidiaries in order to identify any

indications of impairment; - Carry out on-site visits to the plantation of the significant subsidiaries; - Conduct an audit of the data used by the Group to identify any existence of impairment

indicators by comparing them with other sources and reviewing the internal performance indicators of the Group's subsidiaries by comparing them with comparable companies

- Examine, in the case of the occurrence of an impairment loss, the relevance of the model

used to determine the recoverable amount of the biological assets and ensure the reasonableness of the possible impairment loss recognized;

- Analyse the consistency of the cash flow projections used to calculate value-in-use; - Reconcile the main data applied in the model with the information received from the local

auditors; - Assess the reasonableness of the main assumptions, including discount rates, based on

active market data available to the entity at the measurement date, and comparable data; - Testing the arithmetical accuracy of the value-in-use calculation performed by

management. - Verify the appropriateness of the information presented in Note 6 "Biological assets" and

Note 24 "Impairment of assets" in the notes to the consolidated financial statements. Other information Responsibility for other information rests with the Board of Directors. Other information consists of the information presented in the annual report including the management reports and the corporate governance statement but does not include the financial statements and our reports of the "Réviseur d'Entreprises Agréé" on these financial statements. Our opinion on the consolidated financial statements does not extend to other information and we do not express any form of assurance on such information. With respect to our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, assess whether there is a material inconsistency between it and the consolidated financial statements or our knowledge of the during the audit, or if the other information otherwise appears to contain a significant anomaly. If, based on our work, we conclude that there is a significant discrepancy in the other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Board of Directors for the consolidated financial statements The Board of Directors is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRS as adopted by the European Union as well as the internal control that it considers necessary to enable the establishment of consolidated financial statements that are free of material misstatement, whether due to fraud or error.


In preparing the consolidated financial statements, it is the responsibility of the Board of Directors to evaluate the Group's ability to continue as a going concern, to communicate, as the case may be, the issues relating to the continuity of operations. and to apply the accounting principle of going concern, unless the Board of Directors intends to liquidate the Group or cease its activity or if no other realistic solution is offered to it. Responsibilities of the auditor for the audit of the consolidated financial statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a report of the “Réviseur d’Entreprises Agréé” that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Regulation (EU) No. 537/2014, with the law dated 23rd July 2016 and with ISAs as adopted for Luxembourg by the CSSF will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken based on these consolidated financial statements. In the context of an audit conducted in accordance with Regulation (EU) No 537/2014, the law of 23rd July 2016 and ISAs as adopted for Luxembourg by the CSSF, we exercise our professional judgment and exercise a critical mindness throughout this audit. In addition:

• We identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, the design and implementation of audit procedures in response to such risks, and the gathering of financial information. sufficient and appropriate evidence to support our opinion. The risk of non-detection of a significant anomaly resulting from fraud is higher than that of a significant anomaly resulting from an error, since the fraud may involve collusion, forgery, voluntary omissions, misrepresentation or circumventing internal control;

• We gain an understanding of the internal control elements relevant to the audit in order to design audit procedures appropriate to the circumstances and not to express an opinion on the effectiveness of the Group's internal control;

• We assess the appropriateness of the accounting methods used and the reasonableness of the accounting estimates made by the Board of Directors, as well as the related information provided by the latter;

• We draw a conclusion as to the appropriateness of the Board of Directors' use of the going concern accounting principle and, depending on the audit evidence obtained, whether or not there is significant uncertainty related to events or situations that may cast significant doubt on the Group's ability to continue as a going concern. If we conclude that there is material uncertainty, we are required to draw the attention of readers of our report to the information provided in the consolidated financial statements about this uncertainty or, if this information is not adequate to express a modified opinion. Our conclusions are based on the evidence obtained up to the date of our report. However, future events or situations could lead the Group to cease operations;

• We evaluate the overall presentation, the form and content of the consolidated financial statements, including the information provided in the notes, and assess whether the consolidated financial statements represent the underlying transactions and events in a manner that is appropriate a faithful image;

• We obtain sufficient appropriate audit evidence concerning the financial information of the Group's entities and businesses to express an opinion on the consolidated financial statements. We are responsible for the management, supervision and execution of the Group audit, and assume full responsibility for our audit opinion.


We communicate to corporate governance officials, in particular, the scope and expected timing of the audit work and our significant findings, including any significant internal control deficiencies we may have identified during our audit. We also provide corporate governance officials with a statement that we have complied with the relevant rules of professional conduct regarding independence and disclose to them all relationships and other factors that may reasonably be expected to affect the Company's independence. our independence and related safeguards where applicable. Among the questions communicated to corporate governance officials, we determine which were the most important in the audit of the consolidated financial statements of the period considered: these are the key questions of the audit. We describe these issues in our report unless legal or regulatory provisions prevent them from being published. Report on other legal and regulatory requirements We were appointed as statutory auditor by the Annual General Meeting on 31st May 2017 and the total duration of our mission without interruption, including reappointment and previous renewals, is 5 years. The consolidated Management report is consistent with the consolidated financial statements and has been prepared in accordance with applicable legal requirements. The information required by article 68bis paragraph (1) letters c) and d) of the amended law of 19th December 2002 concerning the commercial and companies register and the accounting and annual accounts of the companies included in the consolidated management report financial statements and presented on pages 42 to 43 and in the Company’s management report and presented on pages 126 to 127 are consistent with the consolidated financial statements and have been prepared in accordance with applicable legal requirements. We confirm that our audit opinion is in accordance with the content of the supplementary report to the Audit Committee or the equivalent body. We confirm that we have not provided any prohibited non-audit services as referred to in Regulation (EU) No 537/2014 and that we have remained independent from the Group during the audit. Bertrange, 9th April 2020 C-CLERC S.A. Cabinet de revision agréé Mariateresa Di Martino Réviseur d’entreprises agréé


Consolidated financial statements

1. Consolidated statement of financial position

ASSETS Note 31/12/2019 31/12/2018

EUR EUR

Non-Current Assets

Right-of-use of assets 3 7 206 479 0 Intangible assets 4 2 812 101 2 591 158 Property, plant and equipment 5 256 711 200 263 790 558 Biological assets 6 401 537 304 401 784 792 Investments in associates 8 24 839 331 24 205 267 Financial assets measured at fair value through other comprehensive income 9

91 902 91 902

Long-term advances 1 944 777 1 542 050

Deferred tax assets 10 9 008 775 8 926 034 Other non-current assets

1 669 262 80 693

705 821 131 703 012 454

Current Assets Inventories 11 79 773 790 58 974 220 Trade receivables 12 24 173 479 17 394 515 Other receivables 13 14 684 340 15 695 035 Current tax assets 14 11 631 085 13 442 815 Cash and cash equivalents 15 39 056 804 34 700 835

169 319 498 140 207 420

TOTAL ASSETS 875 140 629 843 219 874


EQUITY AND LIABILITIES Note 31/12/2019 31/12/2018

EUR EUR

Equity attributable to the owners of the Parent

Share capital 16 35 673 300 35 673 300

Share premium 16 87 453 866 87 453 866

Legal reserve 17 3 567 330 3 570 840

Consolidated reserves

182 186 079 178 626 421

Translation reserves

-39 538 678 -36 798 229

Profit for the year

1 577 834 4 763 789

270 919 731 273 289 987

Non-controlling interests 7 112 304 219 109 818 019

Total equity

383 223 950 383 108 006

Non-current liabilities

Deferred tax liabilities 10 9 129 790 9 707 343

Employee Benefits Obligations 18 9 729 372 9 849 311

Long term debt, net of current portion 19 158 935 834 109 878 039

Long term lease liabilities 3, 19 7 903 924 0

Other payables 20 8 001 208 7 739 836

193 700 128 137 174 529

Current liabilities

Short term debt and current portion of long-term debt 19 76 067 913 104 120 025

Short term lease liabilities 3, 19 1 099 533 0

Trade payables

47 655 804 44 786 254

Current tax liabilities 14 18 520 497 19 718 139

Provisions

623 064 2 856 665

Other payables 20 154 249 740 151 456 256

298 216 551 322 937 339

TOTAL EQUITY AND LIABILITIES 875 140 629 843 219 874


2. Consolidated income statement

Note 2019 2018

EUR EUR

Revenue 33 376 123 734 344 574 067

Work performed by entity and capitalized 21 667 081 33 618 587

Change in inventories of finished products and work in progress 1 128 219 947 225

Other operational products 6 979 343 5 834 239

Raw materials and consumables used -133 509 832 -121 118 433

Other external charges -96 911 833 -94 018 472

Staff costs 22 -67 410 520 -64 176 066

Depreciation and impairment expense 23 -49 951 736 -46 887 623

Other operating expenses -11 663 418 -16 468 568

Operating profit

46 451 038 42 304 956

Other financial income 25 2 940 302 4 502 391

Gain on disposals 1 110 618 29 520

Impairment on disposals of assets -197 683 -436 155

Financial expenses 26 -16 698 697 -14 730 598

Profit before taxes

33 605 578 31 670 114

Income tax expense 27 -23 936 077 -18 286 288

Deferred income / tax expense 27 418 117 875 748

Group’s share of income from associates 8 5 754 101 4 934 657

Profit for the period

15 841 719 19 194 231

Profit attributable to non-controlling interests

14 263 885 14 430 442

Profit attributable to the owners of the Parent

1 577 834 4 763 789

Basic earnings per share 28 0.09 0.27

Number of Socfinaf S.A. shares 17 836 650 17 836 650

Basic earnings per share 0.09 0.27

Diluted earnings per share 0.09 0.27


3. Consolidated statement of other comprehensive income

Note 2019 2018

EUR EUR

Profit of the year 15 841 719 19 194 231

Other comprehensive income

Actuarial losses and gains 18 1 325 366 -742 590

Deferred tax on actuarial losses and gains -349 414 225 706

Subtotal of items that can not be reclassified to profit or loss 975 952 -516 884

Gains (losses) on exchange differences on translation of subsidiaries -1 934 351 8 220 561

Share of other comprehensive income related to associates 133 933 441 765

Subtotal of items that can be reclassified to profit or loss -1 800 418 8 662 326

Total other comprehensive income/(loss) -824 466 8 145 442

Comprehensive income 15 017 253 27 339 673

Comprehensive income attributable to non-controlling interests 15 352 893 15 824 557

Comprehensive income attributable to the owners of the Parent -335 640 11 515 116


4. Consolidated statement of cash flows

Note 2019 2018 EUR EUR Operating activities

Profit attributable to the owners of the Parent 1 577 834 4 763 789

Profit attributable to non-controlling shareholders 14 263 885 14 430 442

Income from associates 8 -5 754 101 -4 934 657

Dividends received from associates 8 5 046 264 7 670 517

Fair value of agricultural production 11 -762 313 3 414 137

Other adjustments having no impact on cash position (IFRS and others) -2 136 699 -1 598 690

Depreciation, amortization and provisions and allowances 52 878 130 47 413 995

Net loss on disposals of assets -912 935 406 635

Income tax expense 27 23 517 960 17 410 540

Cash flows from operating activities 87 718 025 88 976 708

Interest received 11 915 659 9 744 737

Income tax paid -23 936 077 -18 286 288

Change in inventory -6 472 456 -8 379 686

Change in trade and other receivables -5 704 429 6 593 477

Change in trade and other payables 967 249 14 860 524

Accruals and prepayments 308 442 -2 182 921

Change in working capital requirement -10 901 194 10 891 394

Net cash flows from operating activities 64 796 413 91 326 551

Investing activities

Acquisitions / disposals of intangible assets -135 076 -521 259

Acquisitions of property, plant and equipment -57 086 687 -88 100 395

Disposals of property, plant and equipment 95 405 3 756 205

Acquisitions / disposals of financial fixed assets 975 401 -31 725

Net cash flows from investing activities -56 150 957 -84 897 174

Financing activities

Dividends paid to the owners of the Parent 0 -1 783 665

Dividends paid to non-controlling shareholders -13 452 604 -13 349 176

Proceeds from borrowings 79 714 483 13 297 580

Repayment of borrowings -28 854 945 -6 933 906

Repayment of lease liabilities -1 229 380 0

Interest paid -11 915 659 -9 744 737

Net cash flows from financing activities 24 261 895 -18 513 904

Effect of exchange rate change 206 693 480 936

Net cash flows 33 114 044 -11 603 591

Cash and cash equivalents as at 1st January 15 -4 241 485 7 362 106 Cash and cash equivalents as at 31st December 15 28 872 559 -4 241 485

Net increase/(decrease) in cash and cash equivalents 33 114 044 -11 603 591


5. Consolidated statement of changes in equity

EUR Share

capital Share

premium Legal

reserve Translation Consolidated

reserves Equity

attributable to the

owners of the Parent

Non-Controlling

Interests

TOTAL

Balance as at 1st January 2018 35 708 400 87 453 866 3 570 840 -43 710 124 180 515 875 263 538 857 107 642 899 371 181 756

Profit/(loss) for the period 4 763 789 4 763 789 14 430 442 19 194 231

Actuarial losses and gains -265 339 -265 339 -251 545 -516 884

Foreign currency translation adjustments 6 574 901 0 6 574 901 1 645 660 8 220 561

Change in comprehensive income of associates 336 994 104 771 441 765 0 441 765

Other comprehensive income 6 911 895 4 603 221 11 515 116 15 824 557 27 339 673 Cancellation of shares -35 100 55 828 20 728 0 20 728

Dividends -1 783 665 -1 783 665 -13 651 054 -15 434 719

Other changes -1 049 -1 049 1 617 569

Transactions with shareholders -35 100 -1 728 886 -1 763 986 -13 649 437 -15 413 423 Balance as at 31st December 2018 35 673 300 87 453 866 3 570 840 -36 798 229 183 390 210 273 289 987 109 818 019 383 108 006


EUR Share

capital Share

premium Legal

reserve Translation Consolidate

d reserves Equity

attributable to the

owners of the Parent

Non-Controlling

Interests

TOTAL

Balance as at 1st January 2019 35 673 300 87 453 866 3 570 840 -36 798 229 183 390 210 273 289 987 109 818 019 383 108 006

Impact of adoption of IFRS 16: Leases (Note 4) -1 057 439 -1 057 439 -358 168 -1 415 607

Adjusted balance as at 1st January 2019 35 673 300 87 453 866 3 570 840 -36 798 229 182 332 771 272 232 548 109 459 851 381 692 399

Profit/(loss) for the period 1 577 834 1 577 834 14 263 885 15 841 719

Actuarial losses and gains 693 042 693 042 282 910 975 952

Foreign currency translation adjustments -2 740 449 0 -2 740 449 806 098 -1 934 351

Transfer between reserves -3 510 3 510 0 0

Change in comprehensive income of associates 133 933 133 933 0 133 933

Other comprehensive income -3 510 -2 740 449 2 408 319 -335 640 15 352 893 15 017 253

Dividends 0 0 -11 503 075 -11 503 075

Interim dividends 0 0 -1 885 865 -1 885 865

Other movements -977 177 -977 177 880 415 -96 762

Transactions with shareholders -977 177 -977 177 -12 508 525 -13 485 702

Balance as at 31st December 2019 35 673 300 87 453 866 3 567 330 -39 538 678 183 763 913 270 919 731 112 304 219 383 223 950

2019 2018

Dividends and interim dividends paid during the period 0 1 783 665

Number of shares 17 836 650 17 836 650

Dividend per share paid during the period 0.00 0.10


6. Notes to the consolidated financial statements

Note 1. General and accounting policies

Socfinaf S.A. (the "Company") was incorporated on 22nd October 1961. Its corporate purpose qualifies it as a soparfi since the Annual General Meeting of 10th January 2011. The registered office is established at 4, avenue Guillaume, L-1650 in Luxembourg. The main activity of the Company and its subsidiaries (the "Group") is the management of a portfolio of holdings mainly focused on the exploitation of tropical oil palm and rubber plantations in Africa. Socfinaf S.A. is controlled by Société Financière des Caoutchoucs, abbreviated as “Socfin” which is the largest entity that consolidates. The registered office of the latter company is also located at 4, avenue Guillaume, L-1650 in Luxembourg. The Company is listed on the Luxembourg Stock Exchange and is registered in the commercial register under the number B 6225. 1.2. Statement of compliance The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union. On 18th March 2020, the Board of Directors approved the consolidated financial statements. New standards or amendments as adopted by the European Union and applicable on 1st January 2019 that are currently effective:

- IFRS 16 "Leases":

On 1st January 2019, the new IFRS 16 "Leases" replaced IAS 17 "Leases". This new standard indicates how to recognize, measure and present leases and related information to be provided. The standard provides a single accounting model for lessees, requiring the recognition of right-of-use asset and a financial debt for all leases, except those with a contract term of 12 months or less or whose underlying asset has a low value. The Group applied the modified retrospective transition approach and did not consequently restate comparative data.

The impact of this new standard is detailed in Note 1.12 and in Note 3. As of 1st January 2019, the Group adopted the following amendments without any material

impact on the Group's consolidated financial statements:

- Interpretation of IFRIC 23 "Uncertainty over Income Tax Treatments":

On 7th June 2017, the IASB issued this interpretation which clarifies the application of the provisions of IAS 12 "Income Taxes" regarding the recognition and measurement of income taxes when an uncertainty exists.

- Amendments to IFRS 9 "Financial Instruments":

On 12th December 2017, the IASB published an amendment to IFRS 9 entitled “Prepayment features with negative compensation” to deal with the frequent case of instruments containing an prepayment clause when the exercise of this clause results in repayment less than the sum of the principal and the interest still due.


This amendment modifies the existing IFRS 9 requirements for termination rights to allow for an amortized cost valuation (or, depending on the business model used, at fair value through other comprehensive income) even in the case of negative compensation payments.

- Amendments to IAS 28 “Investments in Associates" :

On 12th October 2017, the IASB published an amendment to IAS 28 to clarify that an entity shall apply IFRS 9 "Financial Instruments" to long-term interests in an associate or joint venture that, in fact, form part of its net investment in the associate or joint venture, but to which the equity method is not applied.

- Amendments to IAS 19 “Employee Benefits” :

On 7th February 2018, the IASB published an amendment to IAS 19 entitled “Amendment, Curtailment or Liquidation of a Plan" which clarifies that when a plan is amended, curtailed or liquidated, an entity shall recognize and measure past service cost or gain or loss on liquidation without taking into account the effect of the asset ceiling. The entity shall then determine the effect of the asset ceiling after plan amendment, curtailment or wind-up and account for any change in that effect.

- Annual Improvements to IFRSs: 2015-2017 cycle :

On 12th December 2017, the IASB published the Annual Improvements to IFRS: 2015-2017 Cycle which contains amendments to four IFRSs as part of the IASB's annual improvements process:

o IFRS 3 "Business Combinations" specifies that when an entity obtains control of a joint venture, it must re-evaluate its interests previously held in that enterprise.

o IFRS 11 "Joint Arrangements" states that when an entity obtains joint control of a joint venture, it does not have to re-evaluate its interests previously held in that enterprise.

o IAS 12 “Income taxes” specifies that an entity must recognize the tax consequences of dividends in profit or loss, in other comprehensive income or in equity, where the entity had initially recognized these transactions or events.

o IAS 23 "Borrowing Costs" specifies that, if a contracted loan remains due once the related asset is ready for its intended use or sale, then such borrowing must be treated as borrowed funds in a manner that is for the purpose of calculating the capitalization rate of general loans.

New IFRS standards and amendments applicable from 2020:

- “Conceptual Financial Reporting Framework”:

On 29th March 2018, the IASB published its revised “Conceptual Financial Reporting Framework”, which contains revised definitions of an asset and a liability, as well as new guidance on the measurement, derecognition, presentation and the information to be provided. The Group does not expect that the adoption of this amendment will have a material impact on its consolidated financial statements. - Amendments to IAS 1 “Presentation of financial statements” and to IAS 8 “Accounting methods, changes in accounting estimates and errors”: On 31st October 2018, the IASB published amendments to IAS 1 “Presentation of financial statements” and to IAS 8 in order to clarify the definition of “significant” and to harmonize the definitions given in the Conceptual Framework for Financial Reporting and in the standards themselves. The Group does not expect that the adoption of these amendments will have a material impact on its consolidated financial statements.


- Amendments to IFRS 9 "Financial Instruments", IAS 39 "Financial instruments: recognition and measurement" and IFRS 7 "Financial Instruments: Disclosures": On 26th September 2019, the IASB issued amendments to IFRS 9, IAS 39 and IFRS 7 as part of the benchmark interest rate reform as a first step in addressing the potential impact of the reform of interbank offered rates "IORP" on financial reporting. The amendments apply to fiscal years beginning on or after 1st January 2020; early application is permitted. The Group does not expect that the adoption of these amendments will have a material impact on its consolidated financial statements as it mitigates the potential effects of the uncertainty due to the reform of the "TIO" interest rate benchmark.

New IFRS standards, amendments and interpretations not yet endorsed by the European Union:

On 18th May 2017, the IASB issued IFRS 17 "Insurance Contracts", which establishes principles for the recognition, measurement and presentation of contracts. Under IFRS 17, insurance performance should be measured at its current execution value and provide a more consistent measurement and presentation method for all insurance contracts. IFRS 17 replaces IFRS 4 “Insurance contracts” and its interpretations. It is effective as of 1st January 2022 and early adoption is permitted if IFRS 15 "Revenue from Contracts with Customers" and IFRS 9 "Financial Instruments" have been applied. The Group does not expect that the adoption of this interpretation will have a material impact on its consolidated financial statements.

On 22nd October 2018, the IASB published amendments to IFRS 3 “Business Combinations”, relating to the definition of a business, which aim to resolve the difficulties encountered by businesses in determining whether they have acquired a business or a group of assets. The Group does not expect that the adoption of these amendments, which will come into effect for financial years beginning on or after 1st January 2020, will have a material impact on its consolidated financial statements. On 23rd January 2020, the IASB published amendments to IAS 1 "Presentation of Financial Statements" on the classification of liabilities as current and non-current in order to establish a more general approach to the classification of liabilities under IAS 1, based on an analysis of contracts existing at the balance sheet date. The amendments include clarification of the requirements for classifying liabilities that a company could settle by converting them into equity The Group does not plan to early adopt the new accounting standards, modifications and interpretations.

1.3. Presentation of the consolidated financial statements The consolidated financial statements are presented in Euros (EUR or €). They are prepared on the basis of historical cost with the exception of the following assets: - Biological assets (IAS 2, IAS 41), derivative instruments and securities measured at fair value through other comprehensive income are recognized at fair value;

- property, plant and equipment acquired as part of a business combination (IFRS 3) are measured initially at their fair value at the date of acquisition. The accounting principles and rules are applied in a consistent and permanent way in the Group. The consolidated financial statements are prepared for the accounting year ending 31st December 2018 and are presented before allocation of the parent company's income to the Annual Meeting of Shareholders.


1.4. Consolidation principles The consolidated financial statements include the financial statements of the parent company Socfinaf as well as those of the companies controlled by the parent ("subsidiaries") and those of the companies in which Socfinaf has exercised significant influence ("associates"), all of which constitute the Group ". All companies included in the scope of consolidation as at 31st December 2018 close their accounts on 31st December. a) Subsidiaries In accordance with IFRS 10, an investor has control when three conditions are fulfilled: 1) he holds power over the entity; 2) he is entitled to or is exposed to variable returns from its involvement; 3) It has the ability to use its power over the entity to affect returns. Currently, the Group holds the majority of the voting rights in the entities. Income from subsidiaries acquired or sold during the year is included in the consolidated income statement, respectively, from the date of acquisition to the date of disposal. Where appropriate, restatements are made to the financial statements of the subsidiaries to align the accounting principles used with those of other companies in the scope of consolidation. All intra-group balances and transactions are eliminated upon consolidation. b) Investments in associates An associate is a company over which Socfinaf exercises significant influence through its participation in the financial and operational decisions of this company, but over which it has no control. Significant influence is presumed when the Group holds, directly or indirectly through its subsidiaries, between 20% and 50% of the voting rights. Associates are accounted for using the equity method. Under this method, the Group's interest in the associate is initially recognized at cost in the statement of financial position and subsequently adjusted to recognize the Group's share of movements in other comprehensive income. Investments in associates are included in the consolidated financial statements using the equity method from the date on which significant influence begins until the date when this influence ceases. The carrying amount of positive goodwill that results from the acquisition of associates is included in the carrying amount of the investment. An impairment test is performed if an objective index of impairment is identified. Depreciation is recognized, if necessary, in the income statement under the heading “Share in the net income of companies consolidated using the equity method”. The list of subsidiaries and associated companies of the Group is presented in Note 2. 1.5. Changes in Accounting Policies, Errors and Changes in Estimates A change in accounting policy is applied only if it meets the requirements of a standard or interpretation or permits more reliable and relevant information. Changes in accounting policies are accounted for retrospectively, except in the case of transitional provisions specific to the standard or interpretation. An error, when discovered, is also adjusted retrospectively. Uncertainties inherent in the activity require the use of estimates when preparing financial statements. The estimates are based on judgments intended to give a reasonable assessment of the latest reliable information available. An estimate is revised to reflect changes in circumstances, new information available and the effects of experience.


1.6. Goodwill Goodwill is the difference on the date of acquisition between the fair value of the elements given in exchange for taking control, the value of minority interests, the fair value of previous equity investments and the fair value of assets, identifiable liabilities and contingent liabilities of the acquiree. When disposing of a subsidiary or an associated enterprise, the residual amount of goodwill attributable to the subsidiary is included in the calculation of the result of disposal. 1.7. Negative goodwill Negative goodwill represents the excess of the Group's interest in the fair value of identifiable assets and liabilities and the contingent liabilities of a subsidiary or associate on the cost of acquisition on the acquisition date. To the extent that negative goodwill remains after considering and reassessing the fair value of identifiable assets and liabilities and contingent liabilities of a subsidiary or associate, it is recognized directly as a product in the income statement. 1.8. Foreign currency conversion In the financial statements of Socfinaf and of each subsidiary or associated company, transactions in foreign currency are recorded, upon initial recognition, in the reference currency of the company concerned by applying the exchange rate in force on the transaction date. At closing, monetary assets and liabilities denominated in foreign currencies are converted on the last day of the year. Gains and losses arising from the realization or translation of monetary items denominated in foreign currencies are recorded in the income statement for the year. To hedge its exposure to certain foreign exchange risks, the Group uses forward exchange contracts. These financial instruments do not qualify for hedge accounting. They are classified in other instruments (see Note 1.17). On consolidation, the assets and liabilities of companies whose accounts are held in a currency other than the euro are translated into euros at the exchange rate prevailing on the closing date. Income and expenses are converted into euros at the average exchange rate for the year. Any exchange differences are classified as equity under "Translation differences". In the event of a disposal, the translation differences relating to the company concerned are recognized in the income statement for the year in which the sale took place. Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate. The following exchange rates have been used for the conversion of the consolidated annual accounts:

1 Euro equals to: Closing rate Average rate 2019 2018 2019 2018

CFA franc 655.957 655.957 655.957 655.957

Ghanaian Cedi 6.2166 5.5189 5.8724 5.4185

Nigerian Naïra 344.26 350.76 342.76 360.14

Dobra of São Tomé 24.50 24.50 24.50 24.50

Congolese franc 1 879 1 873 1 845 1 914

US Dollar 1.1234 1.1450 1.1192 1.1782


1.9. Intangible assets Intangible assets are stated at their acquisition cost less accumulated depreciation and any impairment losses. Amortisation is applied on a straight-line basis based on an estimate of the useful life of the asset in question. Intangible assets are not subject to revaluation. When the recoverable value of an asset is lower than its book value, the latter is reduced to reflect this loss in value. The estimated useful lives are as follows: Patents 3 to 5 years Other intangible assets 3 to 5 years Software 3 to 5 years Concessions Length of the concession Amortisation starts from the date of bringing the asset into use. 1.10. Property, Plant, Equipment Tangible fixed assets are recorded at their acquisition cost less accumulated amortisation and any impairment losses. Property, plant and equipment in progress is carried at cost less any identified impairment. Depreciation is applied on a straight-line basis based on an estimate of the useful life for each significant component of the asset in question. When the recoverable value of an asset is lower than its book value, the latter is reduced to reflect this loss in value. The estimated useful lives are as follows: Buildings 20 to 50 years Technical installations 3 to 20 years

Furniture, vehicles and others 3 to 10 years

Depreciation starts from the date that the assets are brought into use. Land is not subject to depreciation. 1.11. Biological assets The Group has biological assets in Africa. These biological assets, mainly consisting of palm oil and rubber plantations, are valued according to the principles defined in IAS 16 "Tangible fixed assets". Biological assets at the time of harvest, in particular for palm bunches, palm oil and rubber, is evaluated according to the principles defined by IAS 41 "Agriculture". Biological assets Producer biological assets are recorded at acquisition cost, less accumulated amortization and any impairment losses. Depreciation is applied according to the straight-line method based on an estimate of the useful life. When the recoverable amount of an asset is less than its carrying amount, the carrying amount is reduced to reflect that impairment.


The estimated useful lives are as follows: Biological assets - Palm 20 to 26 years Biological assets - Rubber 20 to 33 years Depreciation start date is the date of transfer of biological assets in production (maturity). This transfer takes place in the fourth year after palm oil tree planting and in the seventh year after rubber tree planting. For each entity, the operating period can be adapted according to the particular circumstances. Agricultural production Agricultural production at harvest is valued at fair value less estimated costs necessary to complete the sale. There are no observable data for agricultural production (palm diets, latex). The World Bank publishes price forecasts for dry rubber (finished product). These forecasts are based on the RSS3 grade (smoked sheet) that is not produced by the Group. Lastly, and even more so, there are no observable prospective data relating to the Group's agricultural production. The price of a standard product in a global market is not sufficiently representative of the economic reality in which the various entities of the Group intervene. This price cannot be used as a reference for valuation. As a result, each entity determines the fair value of agricultural production based on actual market prices obtained over the past year. The Group does not evaluate standing agricultural production (before harvest). In fact, by nature this notion is not applicable to the rubber tree whose agricultural production (latex) is located inside the tree itself. The Group also considers that the harvesting of palms cannot be reliably assessed with sufficient certainty without incurring costs disproportionate to the usefulness of the information collected. The change in fair value is included in income in the period in which it occurs. 1.13. Leases The Group has adopted IFRS 16 "Leases" retrospectively from 1st January 2019, without restatement of comparative figures as permitted by the transition provisions of the standard. Reclassifications and adjustments arising from the new leasing rules have been recognized at the opening of the period starting on 1st January 2019. Following the adoption of IFRS 16, the Group has recognized in the statement of financial position assets for rights-of-use and lease liabilities for leases that were previously treated as operating leases under the principles of IAS 17. Lease liabilities were measured at the value of the remaining lease payments discounted at the incremental borrowing rate at 1st January 2019. Rights to use assets have been measured on a retrospective basis as if the new rules had always been applied. In applying IFRS 16 for the first time, the Group has used the following practical expedients permitted by the standard:

- use of a single discount rate for contracts with similar characteristics; - non-recognition of assets in respect of the right-of-use and lease liabilities for leases with

remaining lease term of less than 12 months on 1st January 2019. The corresponding expenses have been recognized with the expenses related to short-term leases;

- exclusion of initial direct costs for the initial valuation of rights-of-use of assets; - non-separation of the non-leasing component in vehicles leases.


The change in accounting policy impacted the following items in the statement of financial position on 1st January 2019:

• property, plant and equipment: decrease by EUR 0.3 million

• rights of use of assets: increase by EUR 7.9 million

• deferred tax assets: increase by EUR 0.6 million

• borrowings: decrease by EUR 0.3 million

• liabilities related to lease contracts: increase by EUR 9.7 million. The net impact on retained earnings at 1st January 2019 was a decrease of EUR 1.4 million. For leases previously treated as finance leases, the right-of-use assets and the lease liability were recognized at 1st January 2019 at their carrying amount measured in accordance with IAS 17 immediately prior to that date. The Group applies IAS 36 to determine whether an asset with a right-of-use asset is impaired and recognises any impairment loss as described in Note 24: Impairment of assets. Accounting policy applicable before 1st January 2019 Leases are classified as finance leases when the terms of the lease transfer to the lessee substantially all the risks and rewards of ownership. Assets held under finance leases are recognized as Group assets at the lower of the discounted value of the minimum lease payments and their fair value at the inception date of the lease. The corresponding debt to the lessor is recorded in the statement of financial position for the same amount as a lease obligation. Financial expenses, which represent the difference between the total commitments of the contract and the fair value of the property acquired, are spread over the different periods covered by the lease in order to obtain a constant periodic interest rate on the outstanding liability balance for each accounting year. Rent expense under an operating lease is recognized as an expense in the income statement on a straight-line basis over the life of the related lease. 1.13. Impairment of assets Goodwill is not amortized but is tested for impairment at least once a year and whenever there is an indication of impairment. In addition, at each reporting date, the Group reviews the carrying amounts of its intangible and tangible assets, including its organic producing assets, in order to assess whether there is any indication that its assets may have lost value. If there is such an index, the recoverable amount of the asset is estimated to determine, if applicable, the amount of the loss or impairment. The recoverable amount is the higher of the fair value less costs to sell the asset and the value in use. The fair value of property, plant and equipment and intangible assets is the present value of estimated future cash flows expected from the use of an asset or cash-generating unit. When it is not possible to estimate the recoverable amount of an isolated asset, the Group determines the recoverable amount of the cash-generating unit to which the asset belongs. If the recoverable amount of an asset (or a cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. Impairment losses are immediately recognized as expenses in the income statement.


When an impairment loss recognized in a prior period no longer exists or needs to be written down, the carrying amount of the asset (cash-generating unit) is increased to the extent of the revised estimate of its recoverable amount. However, this increased carrying amount may not exceed the carrying amount that would have been determined if no impairment loss had been recognized for the asset (cash-generating unit) in prior years. The reversal of an impairment loss is recognized immediately in income in the income statement. An impairment loss recorded on goodwill cannot be subsequently reversed. 1.14. Inventories Inventories are recorded at their lowest cost and net realizable value. Cost includes direct material costs and, if applicable, direct labor costs and directly attributable overhead costs. Where specific identification is not possible, the cost is determined on the basis of the weighted average cost method. Net realizable value is the estimated selling price in the ordinary course of business less estimated costs of completion and the estimated costs necessary to complete the sale (primarily selling expenses). Impairment or loss on inventory to net realizable value is recognized as an expense in the period in which the impairment or loss occurred. As explained in Note 1.11. Biological assets, agricultural production is measured at fair value less estimated costs necessary to make the sale. 1.15. Trade receivables Trade receivables are valued at their nominal value and do not bear interest. Following the amendments to IFRS 9 "Financial Instruments", the Group applies a simplified approach and records a provision for expected losses over the life of the receivables. This provision for losses is an amount that the Group considers a reliable estimate of the inability of its customers to make the required payments. 1.16. Cash and cash equivalents This item includes cash, demand deposits, short-term deposits of less than 3 months, as well as investments easily convertible into a known amount of cash and which are subject to a negligible risk of change in value. 1.17. Financial instruments Financial assets and liabilities are recognized in the consolidated statement of financial position when the Group becomes a party to the contractual provisions of the instrument. Financial instruments derivatives Financial instruments derivatives are measured at fair value at each reporting date. The accounting treatment depends on the qualification of the instrument concerned: - Hedging instruments: The Group refers to certain hedging instruments, including foreign exchange risk and interest rate risk derivatives, as cash flow hedges. Foreign currency hedges related to firm commitments are accounted for as cash flow hedges. At the inception of the hedging relationship, the entity prepares documentation describing the relationship between the hedging instrument and the hedged item as well as its risk management objectives and strategy for performing various hedging transactions.


In addition, when the hedge is created and regularly thereafter, the Group indicates whether the hedging instrument is highly effective in offsetting changes in the fair value or cash flows of the hedged item attributable to the hedged risk. The effective portion of changes in the fair value of derivatives that are designated as cash flow hedges and qualify for such designation is recognized in other comprehensive income and accumulated in the hedging reserve. cash flow. The gain or loss related to the ineffective portion is recognized immediately in profit or loss, in other gains and losses. Amounts previously recognized in other comprehensive income and accumulated in equity are reclassified to net income in the periods in which the hedged item affects net income, to the same account as the recognized hedged item. However, if a hedged forecast transaction results in the recognition of a non-financial asset or liability, the gains and losses that were previously recognized in other comprehensive income and accumulated in equity are taken out of equity to be recognized in equity. taken into account in the initial measurement of the cost of the non-financial asset or liability. - Other instruments: Changes in the fair value of derivative financial instruments that do not qualify for hedge accounting are recognized in the income statement when they occur. For the periods under review, the two types of derivative financial instruments were used by the Group. Loans Loans bearing interest are recorded for the amounts given, net of direct costs of issue. Financial income is added to the carrying amount of the instrument to the extent that it is not received in the period in which it occurs. Interest is calculated using the effective interest rate method. Interest-bearing borrowings and overdrafts are recorded for amounts received, net of direct issue costs. Financial expenses are accounted for using the relevant accounting method and are added to the carrying amount of the instrument to the extent that they are unpaid in the year in which they occur. The carrying amount is a reasonable approximation of fair value in the case of financial instruments such as borrowings and debts with short-term financial institutions. The fair value measurement of borrowings and debts with financial institutions, other than in the short term, depends both on the specifics of the loans and on current market conditions. The fair value was calculated by discounting the expected future cash flows at the re-estimated interest rates prevailing at the balance sheet date over the remaining term of repayment of the loans. The majority of long-term loans and debts with financial institutions come from institutions located in Europe, which is why the Group relied on the evolution of the interest rate of the European Central Bank adjusted for the specific risk inherent in each financial instrument, as a reasonable benchmark for estimating the fair value of such borrowings. Equity instruments Equity instruments are recognized for the amounts received, net of direct costs generated by the issue. Securities available for sale This item includes shares held by the Group in companies in which it does not exercise control or significant influence or in unconsolidated companies. Upon initial recognition, these assets are recognized at fair value, which is generally at their acquisition cost.


In accordance with the transitional provisions in IFRS 9, the Group has chosen to show securities that are available for sale as financial assets at fair value through comprehensive income, as these investments are held as strategic investments in long term that should not be sold in the short term. For equities of listed companies, the fair value is the market value at the closing date (Level 1). For unlisted securities, the fair value is determined on the basis of revalued net assets (Level 3). At each reporting date, the Group reviews the carrying amounts of its securities in order to assess whether there is any indication that they may have lost value. No profit or loss related to these instruments can be reclassified to income even at the time of derecognition. The impairment criteria applied by the Group, for unlisted securities, are a 40% depreciation compared to the acquisition cost and a loss recognized over a period of more than one year. For listed securities, a definitive impairment loss is recognized in profit or loss if the closing market price is more than 30% lower than its acquisition cost over a period of more than one year. Other financial assets and liabilities Other financial assets and liabilities are recorded at their acquisition cost. The fair value of other financial assets and liabilities is estimated to be close to the carrying amount. The receivables are valued at their nominal value (historical cost) less any write-downs covering amounts considered as non-recoverable if the Group deems it necessary. Depreciation of assets is recognized in the income statement under "Other operating income/expenses". There is no consolidated Group policy on value adjustments. The Board of Directors of each subsidiary evaluates the receivables individually. Value adjustments are determined taking into account the local economic reality of each country. They are reviewed at the reception of new events and at least annually. 1.18. Provisions Provisions are recognized when the Group has a present obligation (legal or constructive) resulting from a past event which will probably lead to an outflow of economic benefits that can be reasonably estimated. Restructuring provisions are recognized when the Group has a formal and detailed plan for the restructuring that has been notified to the affected parties. 1.19. Pension obligations Definition of contribution plans These plans designate the post-employment benefit plans under which the Group pays defined contributions to external insurance companies for certain categories of employees. Payments made under these pension plans are recognized in the income statement in the year in which they are due. As these plans do not generate future commitments for the Group, they do not give rise to provisions. Benefit plans defined These plans refer to post-employment benefit plans that provide additional income to certain categories of employees for services rendered during the year and prior years. This guarantee of additional resources is a future benefit for the Group for which a commitment is calculated by independent actuaries at the end of each financial year. The actuarial assumptions used to determine the liabilities vary according to the economic conditions prevailing in the country in which the plan is located.


The discount rates applicable to discount post-employment benefit obligations should be determined by reference to the market yields on high quality corporate bonds that are appropriate to the estimated timing of benefit payments at the balance sheet date. The Group considers that there is no active market for high-quality corporate bonds or government bonds corresponding to the terms of the employee benefits in the countries concerned. In the absence of available and reliable data, since the end of December 2014, the Group decided to calculate discount rates using an economic approach that better reflects the value of money and the timing of benefit payments. The cost of corresponding commitments is determined using the projected unit credit method, with a discounted value calculation at the balance sheet date in accordance with the principles of IAS 19 "Employee Benefits". The revised version of IAS 19 requires all changes in the amount of defined benefit pension obligations to be recognized as they occur. Remeasurements of defined benefit pension obligations, including actuarial gains and losses, should be recognized immediately in "Other comprehensive income". The costs of services rendered during the period, past service costs (plan amendment) and net interest are recognized as an expense immediately. The amount recognized in the statement of financial position is the present value of the pension obligations of the defined benefit plans adjusted for actuarial gains and losses and less the fair value of plan assets. 1.20. Revenue recognition The Group's revenues derive from the performance obligation of transferring control of products under arrangements. According to these arrangements, the transfer of control and the fulfilment of the performance obligation occur at the same time. The point of control of the asset by the customer depends on when the goods are made available to the carrier or when the buyer takes possession of the goods, depending on the delivery conditions. With regard to the Group's activities, the recognition criteria are generally met: (a) for export sales, where the products are made available to the carrier; (b) for local sales, depending on the delivery conditions, either when the goods leave the premises or when the customer takes possession of the goods. This is the moment when the Group has fulfilled its performance obligations. Revenues are valued at the transaction price of the consideration received or receivable, which the Company expects to be entitled to. The selling price is determined at the market price and in a few cases the selling price is contractually determined on a provisional basis, based on a reliable estimate of the selling price. In the latter case, price adjustments can then take place depending on the movements between the reference price and the final price. Interest income is recognized on a straight-line basis, depending on the outstanding amount of principal and the applicable interest rate.


1.21. Borrowing costs Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset, that is, that require a long period of preparation, must be capitalized in the cost of an asset. However, there is an exception for borrowing costs that are related to the acquisition, construction or production of a qualifying asset measured at fair value. These are recognized in the income statement. Other borrowing costs are recorded in the income statement in the period in which they are incurred. 1.22. Taxes Current tax is the amount of tax payable or recoverable on the profit or loss of a financial year. Temporary differences between the book values of assets and liabilities and their tax bases give rise to the recognition of a deferred tax using the tax rates whose application is provided for when reversing the temporary differences, as adopted on the closing date. Deferred taxes are recognized for all temporary differences unless the deferred tax is generated by goodwill or by the initial recognition of an asset or a liability that is not acquired through a business combination and does not affect the accounting profit or the taxable profit on the transaction date. A deferred tax liability is recognized for all taxable temporary differences related to investments in subsidiaries and associates, unless the date on which the temporary difference will be reversed can be checked and it is likely that it will not will not reverse in the foreseeable future. A deferred tax asset is recognized to carry forward unused tax losses and tax credits to the extent that it is probable that future taxable profits will be available on which these unused tax losses and tax credits can be charged. Deferred tax is recognized in the income statement unless it relates to items that have been directly recognized, either in equity or in other comprehensive income. 1.23. Non-current assets held for sale and discontinued operations These assets include cash-generating units that have been sold or are being held for sale. Assets and liabilities held for sale are presented separately from other assets and liabilities in the statement of financial position and are measured at the lower of their net book value and fair value net of disposal costs. The result of discontinued operations is presented on a separate line in the income statement. 1.24. Business combinations IFRS 3 "Business Combinations" provides the accounting basis for recognizing business combinations and changes in interests in subsidiaries after obtaining control. This standard makes it possible, at each grouping, to opt for the recognition of a positive goodwill (corresponding to majority and minority interests) or a partial positive goodwill (based on the percentage of vested interests). The accounting treatment of this difference is described in points 1.6 and 1.7.


Changes in interest in a subsidiary that do not result in loss of control are accounted for as equity transactions. 1.25. Segment information IFRS 8 "Operating Segments" requires operating segments to be identified based on the internal reporting analysed by the entity's chief operating decision-maker to assess performance and make resource decisions for the segments. The identification of these operational sectors follows from the information analysed by the Management which is based on the geographic distribution of political and economic risks and on the analysis of individual social accounts at historical cost. 1.26. Use of estimates For the preparation of consolidated financial statements in accordance with IFRS, Group Management has had to make assumptions based on its best estimates that affect the carrying amount of assets and liabilities, information on assets and liabilities. contingent liabilities and the carrying amount of income and expenses recorded during the period. Depending on the evolution of these assumptions or different economic conditions, the amounts that will appear in the Group's future consolidated financial statements may differ from current estimates. Significant accounting policies, for which the Group has made estimates, mainly concern the application of IAS 19 (Note 18), IAS 2 / IAS 41 (Notes 6 and 11), IAS 16 (Note 5), IAS 36 (Notes 5, 6 and 24), IFRS 9 (Note 21) and IFRS 16 (Note 3). In the absence of observable data within the scope of IFRS 13, the Group makes uses of a model developed to assess the fair value of agricultural production based on local production costs and local sales. This method is inherently more volatile than assessment at historical cost.


Note 2. Subsidiaries and associates

% Group Interest

% Group Control

Consolidation Method (*)

% Group Interest

% Group Control


2019 2019 2019 2018 2018 2018

AFRICA

Rubber and Palm

SOGB S.A. 63.69 73.16 FI 63.69 73.16 FI

PLANTATIONS SOCFINAF GHANA « PSG » LTD 100.00 100.00 FI 100.00 100.00 FI

OKOMU OIL PALM COMPANY PLC 64.97 64.97 FI 66.12 66.12 FI

SOCIETE AFRICAINE FORESTIERE ET AGRICOLE DU CAMEROUN « SAFACAM S.A. »

69.05 69.05

FI 69.05 69.05

FI

SOCIETE CAMEROUNAISE DE PALMERAIES « SOCAPALM S.A » 67.46 67.46 FI 67.46 67.46 FI

Rubber

LIBERIAN AGRICULTURAL COMPANY « LAC » 100.00 100.00 FI 100.00 100.00 FI

SALALA RUBBER CORPORATION « SRC » 100.00 100.00 FI 100.00 100.00 FI

SUD COMOË CAOUTCHOUC « SCC » 60.95 70.01 FI 60.95 70.01 FI

Palm

SOCFIN AGRICULTURAL COMPANY « SAC » LTD 93.00 93.00 FI 93.00 93.00 FI

SOCIETE DES PALMERAIES DE LA FERME SUISSE «SPFS» 67.46 100.00 FI 67.46 100.00 FI

AGRIPALMA LDA 88.00 88.00 FI 88.00 88.00 FI

BRABANTA S.A. 99.80 99.80 FI 99.80 99.80 FI

Other Activities

BEREBY-FINANCES « BEFIN » S.A. 87.06 87.06 FI 87.06 87.06 FI

CAMSEEDS S.A. 67.15 99.54 FI 67.15 99.54 FI


% Group Interest

% Group Control


% Group Interest

% Group Control


2019 2019 2019 2018 2018 2018

EUROPE Other Activities CENTRAGES S.A. 50.00 50.00 EM 50.00 50.00 EM

IMMOBILIERE DE LA PEPINIERE S.A. 50.00 50.00 EM 50.00 50.00 EM

INDUSERVICES S.A. 30.00 30.00 EM 30.00 30.00 EM

INDUSERVICES FR S.A. 50.00 50.00 EM 50.00 50.00 EM

MANAGEMENT ASSOCIATES S.A. 20.00 20.00 EM 20.00 20.00 EM

SOCIETE ANONYME FORESTIERE AGRICOLE « SAFA » 100.00 100.00 FI 100.00 100.00 FI

SOCFIN GREEN ENERGY S.A. 50.00 50.00 EM 50.00 50.00 EM

SOCFIN RESEARCH S.A. 50.00 50.00 EM 50.00 50.00 EM

SOCFINCO S.A. 50.00 50.00 EM 50.00 50.00 EM

SOCFINCO FR S.A. 50.00 50.00 EM 50.00 50.00 EM

SOCFINDE S.A. 20.00 20.00 EM 20.00 20.00 EM

SODIMEX S.A. 50.00 50.00 EM 50.00 50.00 EM

SODIMEX FR S.A. 50.00 50.00 EM 50.00 50.00 EM

SOGESCOL FR S.A. 50.00 50.00 EM 50.00 50.00 EM

STP INVEST S.A. 100.00 100.00 FI 100.00 100.00 FI

TERRASIA S.A. 33.28 33.28 EM 33.28 33.28 EM (*) Consolidation method: FI: Full Integration - EM: Equity Method.


List of subsidiaries and associated companies * AGRIPALMA LDA is a company located on the island of São Tomé and Principe specialized in the

production of palm oil. * BEREBY-FINANCES « BEFIN » S.A. is a holding company under Ivorian law owning the Ivorian companies

SOGB S.A. and SCC. * BRABANTA S.A. is a company under Congolese law specialized in the production of palm oil. * CAMSEEDS S.A. is a company under Cameroonian law specialized in research, development and

production of seeds (palm). * CENTRAGES S.A. is a company under Belgian law providing administrative and accounting services and

owning three floors of office space in Brussels. * IMMOBILIERE DE LA PEPINIERE S.A. is a company under Belgian law owning three floors of office space

in Brussels. * INDUSERVICES S.A. is a company under Luxembourg law whose purpose is to provide all administrative

services to all companies and organizations, including all services relating to documentation, bookkeeping and register services, as well as all representation, study and consultation activities and assistance.

* INDUSERVICES FR S.A. is a company under Swiss law whose purpose is to provide all administrative

services to all companies, organizations and companies, including all services relating to documentation, bookkeeping and register services, as well as all representation, study and consultation activities. and assistance. In addition, it provides all Group companies with access to the common IT platform.

* LIBERIAN AGRICULTURAL COMPANY « LAC » is a company under Liberian law specializing in the

production of rubber. * MANAGEMENT ASSOCIATES S.A. is a company under Luxembourg law active in the transport sector. * OKOMU OIL PALM COMPANY PLC is a company under Nigerian law specialized in the production of

palm and rubber products. * PLANTATIONS SOCFINAF GHANA « PSG » LTD is a company under Ghanaian law specialized in the

production of palm and rubber products. * SOCIETE AFRICAINE FORESTIERE ET AGRICOLE DU CAMEROUN « SAFACAM S.A. » is a company under

Cameroonian law active in the production of palm oil and the cultivation of rubber trees. * SALALA RUBBER CORPORATION « SRC » is a company under Liberian law active in the production of

palm oil and the cultivation of rubber trees. * SOCIETE CAMEROUNAISE DE PALMERAIES « SOCAPALM S.A. » is active in Cameroon in the production of

palm oil and rubber cultivation. * SOCFIN AGRICULTURAL COMPANY « SAC » LTD is a company located in Sierra Leone specialized in the

production of palm oil. * SOCFIN CONSULTANT SERVICES « SOCFINCO » S.A. is a company established in Belgium providing

technical assistance, agronomic and financial services.


* SOCFIN GREEN ENERGY S.A. is a Swiss company in the realization and maintenance studies of energy production units.

* SOCFIN RESEARCH S.A. is a Swiss research and agricultural project company. * SOCFINCO FR S.A. is a Swiss company providing services, studies and management of agro-industrial

plantations. * SOCIETE ANONYME FORESTIERE AGRICOLE « SAFA » is a company under French law holding a stake in

a plantation in Cameroon, Safacam S.A. * SOCFINDE S.A. is a finance holding company under Luxembourg law. * SOCIETE DES PALMERAIES DE LA FERME SUISSE « SPFS » S.A. is active in Cameroon in the production,

processing and marketing of palm oil. * SODIMEX S.A. is a company incorporated under Belgian law active in the field of purchase and sale of

planting material. * SODIMEX FR S.A. is a company under Swiss law active in the field of purchase and sale of planting

material. * SOGB S.A. is a company under Ivorian law specialized in the production of palm and rubber products. * SOGESCOL FR S.A. is a Swiss company active in the tropical products trade. * STP INVEST S.A. is a company under Belgian law with a stake in Agripalma LDA. * SUD COMOË CAOUTCHOUC «SCC» is a company under Ivorian law whose activity is the processing and

marketing of rubber. * TERRASIA S.A is a company under Luxembourg law owning office spaces.


Note 3. Leases

The Group leases office space and agricultural land for terms ranging from 1 to 99 years, as well as vehicle and equipment for terms ranging from 1 month to 5 years. The Group's lease contracts are standard contracts that do not include additional non-leasing components, except for some vehicle lease contracts that include a maintenance service. The Group has used the practical expedient that allows not separating the lease component from the non-lease component for these contracts Assets and liabilities related to lease contracts are initially measured at the present value of the fixed payments including in-substance fixed payments less any lease incentives receivable. Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability. As the implicit interest rate is not known for all the Group's contracts, the incremental borrowing rate was used to discount the lease payments. The incremental borrowing rate is the rate that the lessee Group would have to pay to borrow, for a similar term and with a similar guarantee, the funds necessary to acquire an asset of similar value to the asset under the right-of-use in a similar economic environment. In determining the incremental borrowing rate, the Group:

- where possible, uses the most recent financing received by the lessee entity as a starting

point, adjusted to reflect the change in financing conditions since the financing was received;

- uses a build-up approach starting with a risk-free rate adjusted for credit risk for leases for

entities with no recent external financing;

- makes lease specific adjustments (such as term, country, currency and collateral).

The discount rates used by the Group range between 2.4% and 19.9%. Lease payments are allocated between the repayment of the principal amount of the lease liabilities and interest expense. Interest expense is recognized in the income statement for the period over the term of the lease. Right-of-use assets are depreciated on a straight-line basis over the shorter of the useful life and the lease term. Payments associated with short-term leases and leases of low-value assets are recognized as an expense in the income statement on a straight-line basis. Short-term leases are those with a term of 12 months or less. Low value assets consist mainly of computer equipment. Extension and termination options have been included in the determination of the term of certain leases. To this purpose, management takes into account all facts and circumstances that may create an incentive to exercise a renewal option or not to exercise an early termination option.


For land, office and other real estate leases, the most important factors considered are as follows:

- the obligation to pay significant penalties for early termination of a contract;

- the residual value of leasehold improvement at the time the Group has the option to renew a

contract;

- the cost of replacing leased assets and the disruption to operating activities that could result

from replacement.

Extension options of equipment and vehicles leases have not been included the lease liability, because the Group could replace the assets without significant cost or business disruption. The amounts recognized in the balance sheet, in 2019, related to leases are as follows: Right-to-use assets:

EUR Furniture,

vehicles and other

Buildings

Land and concession

of agricultural

area

Total

Impact of adoption of IFRS 16 4 738 135 672 574 7 309 803 12 720 512

Additions of the year 467 578 0 37 376 504 954

Foreign currency translation 34 699 41 23 051 57 791

Gross value as at 31st December 2019 5 240 412 672 615 7 370 230 13 283 257

Impact of adoption of IFRS 16 -2 488 950 -368 342 -1 972 949 -4 830 241

Depreciations of the year -1 053 723 -38 394 -126 314 -1 218 431

Foreign currency translation -19 391 -9 -8 706 -28 106

Accumulated depreciation as at 31st December 2019 -3 562 064 -406 745 -2 107 969 -6 076 778

Net book value as at 31st December 2019 1 678 348 265 870 5 262 261 7 206 479

Lease liabilities

EUR 31/12/2019 01/01/2019 (*)

Long-term lease liabilities 7 903 924 8 593 421

Short-term lease liabilities 1 099 533 1 096 967

Total 9 003 457 9 690 388 (*) The balance as at 1st January 2019 relates to the impact of first use of IFRS 16.


The amount recognized in the income statement in relation with the lease contracts are detailed as follows:

EUR 2019

Depreciation of right-of-use assets 1 218 431 Expenses related to short term leases and low-value assets 703 869 Interest expense (included in the financial expenses) 910 029

Total 2 832 329 Lease commitments under IAS 17: Commitments for minimum lease payments are payable as follows:

2018 EUR Within

one year 2020 2021 2022 2023

2024 and over

TOTAL

Commitments for lease payments 2 118 309 1 680 870 1 329 091 742 170 700 248 24 351 007 30 921 695

Reconciliation of the lease commitments under IAS 17 and the lease liabilities under IFRS 16 : EUR 01/01/2019

Lease commitments as at 31st December 2018 30 921 695

Discounted using the lessee’s incremental borrowing at 1st January 2019 9 169 021

Debt related to finance leases as at 1st January 2019 274 878

Payments related to short term leases -171 150

Adjustments for differences in the treatment of extension periods 417 639

Lease liabilities as at 1st January 2019 9 690 388

Due later than one year 8 593 421

Due within one year 1 096 967


Note 4. Intangible assets

EUR Concessions

and patents

Software Other intangible

assets

TOTAL

Cost as at 1st January 2018 2 806 994 1 013 811 1 298 003 5 118 808

Additions of the year 0 0 474 092 474 092

Disposals of the year -278 087 0 -20 300 -298 387

Reclassifications to other asset classes 0 -271 656 104 -271 552

Foreign currency translation -112 732 8 429 2 852 -101 451

Cost as at 31st December 2018 2 416 175 750 584 1 754 751 4 921 510

Accumulated depreciation as at 1st January 2018 -131 183 -445 942 -1 159 285 -1 736 410 Depreciation of the year -54 482 -30 903 -513 661 -599 046 Foreign currency translation 5 500 2 456 -2 852 5 104

Accumulated depreciation as at 31st December 2018 -180 165 -474 389 -1 675 798 -2 330 352

Net book value as at 31st December 2018 2 236 010 276 195 78 953 2 591 158

Cost as at 1stJanuary 2019 2 416 175 750 584 1 754 751 4 921 510

Additions of the year 0 9 578 282 685 292 263

Disposals of the year 0 0 -157 187 -157 187

Reclassifications to other asset classes 278 087 8 686 -241 677 45 096

Foreign currency translation -300 156 -2 841 1 270 -301 727

Cost as at 31st December 2019 2 394 106 766 007 1 639 842 4 799 955

Accumulated depreciation as at 1stJanuary 2019 -180 165 -474 389 -1 675 798 -2 330 352

Depreciation of the year -50 271 -9 824 -22 367 -82 462

Depreciation reversals of the year 0 -130 0 -130

Reclassifications to other asset classes 0 0 -36 410 -36 410

Foreign currency translation 20 792 7 623 433 085 461 500

Accumulated depreciation as at 31st December 2019

-209 644 -476 720 -1 301 490 -1 987 854

Net book value as at 31st December 2019 2 184 462 289 287 338 352 2 812 101


Note 5. Property, plant and equipment

EUR Land and nurseries

Buildings Technical

Installations

Furniture, vehicles and

others

Work in progress

Advances and

prepayments TOTAL

Cost as at 1st January 2018 10 988 653 191 383 553 78 749 247 189 854 797 31 924 490 4 579 944 507 480 684

Additions of the year 1 845 957 5 904 114 9 712 771 11 352 047 16 980 277 6 856 410 52 651 576

Disposals of the year -13 173 0 -2 344 -2 816 738 -3 008 025 0 -5 840 280

Reclassifications to other asset classes -1 169 782 6 976 786 13 278 786 6 357 783 -15 522 532 -10 467 080 -546 039

Foreign currency translation 278 235 2 658 034 1 484 058 2 049 697 492 741 -52 807 6 909 958

Cost as at 31st December 2018 11 929 890 206 922 487 103 222 518 206 797 586 30 866 951 916 467 560 655 899

Accumulated depreciation as at 1st January 2018 -1 235 283 -87 638 581 -51 043 767 -129 839 814 0 0 -269 757 445

Depreciation of the year -27 698 -9 081 880 -5 220 785 -12 314 998 0 0 -26 645 361

Depreciation reversals of the year 0 0 2 344 2 171 011 0 0 2 173 355

Reclassifications to other class of assets 0 -8 043 1 196 6 847 0 0 0

Foreign currency translation -413 -757 182 -543 328 -1 334 967 0 0 -2 635 890

Accumulated depreciation as at 31st December 2018 -1 263 394 -97 485 686 -56 804 340 -141 311 921 0 0 -296 865 341

Net book value as at 31st December 2018 10 666 496 109 436 801 46 418 178 65 485 665 30 866 951 916 467 263 790 558


EUR Land and

nurseries Buildings Technical

installations Furniture,

vehicles and others

Work in progress

Advances and

prepayments

TOTAL

Cost as at 1st January 2019 11 929 890 206 922 487 103 222 518 206 797 586 30 866 951 916 467 560 655 899

Additions of the year 993 061 846 950 2 995 586 4 842 490 27 196 972 190 569 37 065 628

Disposals of the year 0 0 -34 201 -3 004 712 0 0 -3 038 913

Reclassifications to other asset classes -617 584 9 756 608 21 569 431 -6 367 072 -38 350 686 -961 025 -14 970 328

Foreign currency translation 110 769 268 501 128 923 459 730 -489 215 -1 698 477 010

Others -272 118 0 0 0 0 0 -272 118

Cost as at 31st December 2019 12 144 018 217 794 546 127 882 257 202 728 022 19 224 022 144 313 579 917 178

Accumulated depreciation as at 1st January 2019 -1 263 394 -97 485 686 -56 804 340 -141 311 921 0 0 -296 865 341

Depreciation of the year -26 437 -9 804 190 -6 528 724 -12 426 025 0 0 -28 785 376


Reclassifications to other asset classes 0 11 856 -17 390 1 669 0 0 -3 865

Foreign currency translation 128 -167 441 -189 337 -227 053 0 0 -583 703

Accumulated depreciation as at 31st December 2019 -1 289 703 -107 445 461 -63 505 590 -150 965 224 0 0 -323 205 978

Net book value as at 31st December 2019 10 854 315 110 349 085 64 376 667 51 762 798 19 224 022 144 313 256 711 200 On 31st December 2019, the Group has technical installations and professional equipment pledged as guarantees for borrowings of the Group for an amount of EUR 16 million. Details of these guarantees are provided in Note 31. In 2019, the Group reclassified spare parts that were presented as tangible assets. A review of spare parts inventories showed that these parts are interchangeable and do not meet the criteria for classification as tangible assets. In 2018, the inventory of spare parts presented as tangible assets amounted to EUR 14.2 million.


Note 6. Biological assets

EUR Palm Rubber Others Total Mature Immature Mature Immature

Cost as at 1st January 2018 246 136 489 114 182 379 109 662 424 82 007 703 14 348 552 003 343

Additions of the year 0 21 017 895 135 051 14 295 873 0 35 448 819

Disposals of the year -3 375 191 -47 832 -2 194 250 -293 347 0 -5 910 620

Reclassifications to other asset classes 20 934 597 -21 247 986 10 799 812 -9 316 642 0 1 169 781 Foreign currency translation 3 330 415 1 559 213 2 163 144 1 686 616 0 8 739 388

Cost as at 31st December 2018 267 026 310 115 463 669 120 566 181 88 380 203 14 348 591 450 711

Accumulated depreciation as at 1st January 2018 -81 688 867 0 -43 112 256 0 -10 097 -124 811 220

Depreciation of the year -11 142 039 0 -5 389 374 0 -56 -16 531 469


Foreign currency translation -408 127 0 -917 733 0 0 -1 325 860

Accumulated depreciation as at 31st December 2018 -89 904 457 0 -47 318 921 0 -10 153 -137 233 531

Accumulated impairment as at 1st January 2018 -17 854 586 -4 013 075 -5 063 248 -21 284 598 0 -48 215 507

Impairment of the year 0 -3 111 747 0 0 0 -3 111 747

Reclassifications to other asset classes -3 798 986 3 798 986 -2 529 661 2 529 661 0 0

Foreign currency translation -220 534 85 685 -281 987 -688 298 0 -1 105 134

Accumulated impairment as at 31st December 2018 -21 874 106 -3 240 151 -7 874 896 -19 443 235 0 -52 432 388

Net book value as at 31st December 2018 155 247 747 112 223 518 65 372 364 68 936 968 4 195 401 784 792


EUR Palm Rubber Others Total

Mature Immature Mature Immature

Cost as at 1st January 2019 267 026 310 115 463 669 120 566 181 88 380 203 14 348 591 450 711

Additions of the year 0 9 772 022 82 688 10 166 350 0 20 021 060

Disposals -124 050 -4 539 -2 649 722 0 0 -2 778 311

Reclassifications to other asset classes 107 241 214 -107 359 666 17 461 318 -16 410 602 0 932 264

Foreign currency translation -2 640 889 764 124 926 529 -134 062 0 -1 084 298

Cost as at 31st December 2019 371 502 585 18 635 610 136 386 994 82 001 889 14 348 608 541 426

Accumulated depreciation as at 1st January 2019 -89 904 457 0 -47 318 921 0 -10 153 -137 233 531

Depreciation for the year -13 878 895 0 -5 986 516 0 -56 -19 865 467

Depreciation reversals of the year 6 232 0 2 585 956 0 0 2 592 188

Reclassifications to other asset classes 0 0 -314 681 0 0 -314 681

Foreign currency translation 152 160 0 -392 179 0 0 -240 019

Accumulated depreciation as at 31st December 2019 -103 624 960 0 -51 426 341 0 -10 209 -155 061 510

Accumulated impairments as at 1st January 2019 -21 874 106 -3 240 151 -7 874 896 -19 443 235 0 -52 432 388

Reclassifications to other asset classes -3 111 747 3 111 747 -3 836 029 3 836 029 0 0

Foreign currency translation 683 408 453 -123 358 -70 727 0 489 776

Accumulated impairments as at 31st December 2019 -24 302 445 -127 951 -11 834 283 -15 677 933 0 -51 942 612

Net book value as at 31st December 2019 243 575 180 18 507 659 73 126 370 66 323 956 4 139 401 537 304 On 31st December 2019, the Group has biological assets pledged as guarantees for borrowings of the Group for an amount of EUR 21 million. Details of these guarantees are provided in Note 31.


Note 7. Non-wholly owned subsidiaries in which non-controlling interests are

significant

Interests of non-controlling interests in the activities of the Group

Name of subsidiary Main

location

Percentage of equity shares of non-controlling

interests

Percentage of voting rights of non-controlling

interests

2019 2018 2019 2018

Production of palm oil and rubber

SOGB S.A. Ivory Coast 36% 36% 27% 27%

OKOMU OIL PALM COMPANY PLC

Nigeria 35% 34% 35% 34%

SAFACAM S.A. Cameroon 31% 31% 31% 31%

SOCAPALM S.A. Cameroon 33% 33% 33% 33%

Name of subsidiary

Net income attributed to non-controlling interests in the subsidiary during the

financial period

Accumulation of non-controlling interests in the

subsidiary

2019 2018 2019 2018

EUR EUR EUR EUR

SOGB S.A. 2 426 308 2 307 512 30 158 631 29 427 906

OKOMU OIL PALM COMPANY PLC 5 516 491 6 218 914 30 701 118 28 200 753

SAFACAM S.A. -191 741 -505 021 14 456 594 14 909 632

SOCAPALM S.A. 6 270 642 6 293 457 31 730 317 30 864 048

Subsidiaries that hold non-controlling interests 5 257 559 6 415 680

not significant individually

Non-controlling interests 112 304 219 109 818 019


Summary financial information concerning subsidiaries whose interests of non-controlling interests are significant for the Group excluding intragroup eliminations

Name of the subsidiary Current Assets

Non-Current Assets

Current Liabilities

Non-Current Liabilities

2018 EUR EUR EUR EUR

SOGB S.A. 29 862 158 102 016 176 47 916 212 5 636 196


SAFACAM S.A. 9 185 570 37 184 996 14 324 658 2 526 579

SOCAPALM S.A. 38 938 367 113 342 597 30 725 327 10 874 480


SOGB S.A. 31 954 534 101 284 416 35 386 831 17 245 405


SAFACAM S.A. 11 686 609 36 458 781 11 669 912 6 597 491

SOCAPALM S.A. 34 831 115 111 676 899 26 308 558 6 476 317

Name of the subsidiary Revenue Net Income for the year

Comprehensive income for the

year

Dividend paid to non-controlling interests


SOGB S.A. 86 439 037 4 539 165 4 539 165 4 242 622


SAFACAM S.A. 25 350 850 871 674 871 674 697 030

SOCAPALM S.A. 100 593 943 17 370 413 17 370 413 3 858 690


SOGB S.A. 93 587 546 6 891 236 6 891 236 1 237 431


SAFACAM S.A. 26 730 831 1 229 630 1 229 630 270 349

SOCAPALM S.A. 106 416 554 18 667 650 18 667 650 5 084 392


Name of the Subsidiary

Net cash inflows (outflows) Net cash inflows

(outflows) Operating activities

Investing activities

Financing activities


SOGB S.A. 14 476 102 -9 415 761 -19 807 005 -14 746 664

OKOMU OIL PALM COMPANY PLC 22 946 052 -15 879 732 -3 950 086 3 116 234

SAFACAM S.A. 3 384 991 -3 267 162 -3 472 589 -3 354 760

SOCAPALM S.A. 26 962 205 -12 385 574 -9 265 638 5 310 994


SOGB S.A. 8 980 788 -5 826 748 16 961 067 20 115 106

OKOMU OIL PALM COMPANY PLC 4 442 022 -12 868 510 4 206 880 -4 219 608

SAFACAM S.A. 4 073 545 -2 464 880 7 912 103 9 520 769

SOCAPALM S.A. 38 583 687 -10 086 096 -22 219 464 6 278 127

The nature and evolution of the risks associated with the interests held by the Group in the subsidiaries remained stable over the financial period compared to the previous year.

Note 8. Investments in associates

2019 2018 EUR EUR

Value as at 1st January 24 205 267 26 386 023 Income from associates 5 754 101 4 934 657 Dividends -5 046 264 -7 670 517 Fair value change for financial assets measured at fair value through other comprehensive income (loss) 133 933 104 771 Other movements -207 706 450 333

Value as at 31st December 24 839 331 24 205 267


Value of investment in

associates

Income from associates

Value of investment in

associates

Income from associates

2019 2019 2018 2018

EUR EUR EUR EUR

Centrages S.A. 3 156 626 20 153 3 236 473 97 156

Immobilière de la Pépinière S.A. 1 921 744 -126 366 2 048 326 -118 334

Induservices S.A. 69 658 1 770 67 888 1 889

Induservices FR S.A. -890 313 -197 716 -497 977 -267 103

Management Associates S.A. -2 382 7 847 -10 229 -10 995

Socfin Green Energy S.A. 752 833 101 343 651 490 102 943

Socfin Research S.A. 1 774 935 -195 663 1 970 598 -219 755

Socfinco S.A. 872 578 103 170 1 069 408 250 756

Socfinco FR S.A. 4 809 598 2 015 068 4 760 965 1 915 028

Socfinde S.A. 2 080 919 53 714 2 027 204 64 750

Sodimex S.A. 167 446 57 309 210 137 -2 400

Sodimex FR S.A. 2 183 819 444 333 1 739 486 605 295

Sogescol FR S.A. 7 686 340 3 461 377 6 683 730 2 506 230

Terrasia S.A. 255 530 7 762 247 768 9 194

TOTAL 24 839 331 5 754 101 24 205 267 4 934 654

Total assets Revenue Total assets Revenue

2019 2019 2018 2018

EUR EUR EUR EUR

Centrages S.A. 3 541 811 2 781 074 3 611 666 2 660 705

Immobilière de la Pépinière S.A. 4 390 218 449 334 4 647 630 460 918

Induservices S.A. 2 554 004 3 817 000 1 631 490 6 549 500

Induservices FR S.A. 5 507 277 2 007 530 4 721 333 1 705 640

Management Associates S.A. 14 582 030 4 375 932 12 300 416 3 245 758

Socfin Green Energy S.A. 1 537 392 488 823 1 339 394 386 209

Socfin Research S.A. 3 975 939 50 922 4 362 396 170 351

Socfinco S.A. 1 874 612 1 627 536 2 266 813 2 145 770

Socfinco FR S.A. 14 712 139 20 876 086 10 707 280 19 990 681

Socfinde S.A. 120 673 505 0 118 197 858 0

Sodimex S.A. 555 407 0 576 266 36 601

Sodimex FR S.A. 13 474 446 22 146 453 17 154 484 24 862 029

Sogescol FR S.A. 35 282 616 276 101 249 34 878 909 238 258 853

Terrasia S.A. 527 223 67 011 506 551 65 987

TOTAL 223 188 619 334 788 950 216 902 486 300 539 002


Main data of significant associates accounted for using the equity method

Name of the associate

Main location Main activity Dividend received

Dividend received

2019 2018

EUR EUR

Socfinco FR S.A. Switzerland Rendering of services 2 000 000 3 000 000

Sodimex S.A. Belgium Purchase and sale of equipment 100 000 350 000

Sogescol FR S.A. Switzerland Trade of tropical products 2 690 342 3 632 789

Summary financial information of interests held in associates - Statement of financial position

Name of the associate Current assets Non-Current

assets Current

liabilities Non-current

liabilities


Management Associates S.A. 624 831 11 675 585 1 534 644 8 200 000

Socfinco FR S.A. 9 763 533 943 747 1 159 735 0

Socfinde S.A. 115 376 271 2 821 587 106 030 903 6 494 599

Sodimex S.A. 576 266 0 155 992 0

Sogescol FR S.A. 34 123 513 755 396 21 504 904 0

TOTAL 160 464 414 16 196 315 130 386 178 14 694 599


Management Associates S.A. 3 583 984 10 998 045 3 777 023 8 200 000

Socfinco FR S.A. 10 800 684 3 911 455 2 173 231 2 763 958

Socfinde S.A. 109 597 805 11 075 700 108 237 979 6 494 599

Sodimex S.A. 555 407 0 351 227 0

Sogescol FR S.A. 34 280 953 1 001 663 20 394 982 0

TOTAL 158 818 833 26 986 863 134 934 442 17 458 557


Summary financial information of interests held in associates - Income statement

Name of the associate Profit from operations

Net income for the year

Comprehensive income for the

year

2018 EUR EUR EUR

Management Associates S.A. -188 155 -188 155 -188 155

Socfinco FR S.A. 3 745 494 3 745 494 3 745 494

Socfinde S.A. 323 752 323 752 323 752

Sodimex S.A. -4 800 -4 800 -4 800

Sogescol FR S.A. 5 379 327 5 379 327 5 379 327

TOTAL 9 255 618 9 255 618 9 255 618

2019 EUR EUR EUR

Management Associates S.A. 39 235 39 235 39 235

Socfinco FR S.A. 4 227 405 4 227 405 4 227 405

Socfinde S.A. 268 572 268 572 268 572

Sodimex S.A. -16 094 -16 094 -16 094 Sogescol FR S.A. 6 622 199 6 622 199 6 622 199

TOTAL 11 141 317 11 141 317 11 141 317 Reconciliation of the financial information summarised above to the carrying amount of the investments in the consolidated financial statements

Name of the associate company Net assets of the associate

% stake held by the Group

Other IFRS adjustments

Value of stake held by the

Group

2018 EUR EUR EUR

Management Associates S.A. 2 565 772 20% -523 383 -10 229

Socfinco FR S.A. 9 547 545 50% -12 808 4 760 965

Socfinde S.A. 5 672 356 20% 892 733 2 027 204

Sodimex S.A. 420 274 50% 0 210 137 Sogescol FR S.A. 13 374 005 50% -3 273 6 683 730

TOTAL 31 579 952 353 269 13 671 807

2019 EUR EUR EUR

Management Associates S.A. 2 605 006 20% -523 383 -2 382

Socfinco FR S.A. 9 774 950 50% -77 877 4 809 598

Socfinde S.A. 5 940 927 20% 892 734 2 080 919

Sodimex S.A. 204 180 50% 65 356 167 446

Sogescol FR S.A. 14 887 634 50% 242 523 7 686 340

TOTAL 33 412 697 599 353 14 741 921 There is no goodwill attributed to the above associates.


Aggregated information relating to associates that are not significant individually

2019 2018 EUR EUR

Share of profit from operations attributable to the Group 158 786 462 041

Share of total profit attributable to the Group 158 786 462 041

Total book value of investments in associates held by the Group 10 097 410 10 533 460

After tax profit from discontinued operations and other comprehensive income for the year for 2019 and 2018 are nil for all associate companies of the Group. The nature, extent and financial impact of the interests held in associates by the Group, including the nature of relationships with other investors, remained stable over the financial period compared to the previous year.

Note 9. Financial assets at fair value through other comprehensive income

2019 2018

EUR EUR

Fair value as of 1st January 91 902 91 902

Change in fair value 0 0

Fair value as of 31st December 91 902 91 902

EUR Cost (historical) Fair value

2019 2018 2019 2018

Financial assets at fair value through other comprehensive income

47 570 47 570 91 902 91 902


Note 10. Deferred taxes

* Components of deferred tax assets

2019 2018

EUR EUR

IAS 2/IAS 41: Agricultural Produce 120 816 -36 108

IAS 12: Tax latencies 3 360 755 3 677 498

IAS 16: Tangible assets 4 024 519 4 048 323

IAS 19: Pension obligations 897 960 836 721

IAS 21: Translation differences -61 118 3 711

IAS 37: Provisions for risks and charges -345 300 -341 117

IAS 38: Formation expenses 1 280 930 1 237 204

IAS 38: Research costs 410 501 610 283 IFRS 9: Financial assets measured at fair value through other comprehensive income 44 201 44 201

IFRS 16: Leases 583 185 0

Others -1 307 674 -1 154 682

Balance as at 31st December 9 008 775 8 926 034

* Components of deferred tax liabilities

2019 2018

EUR EUR

IAS 2/IAS 41: Agricultural Produce 1 044 506 655 229 IAS 12: Tax latencies -897 850 -1 065 571 IAS 16: Tangible assets 9 165 987 10 274 320 IAS 19: Pension obligations -1 215 830 -1 151 461 IAS 37: Provisions for risks and charges 945 950 902 257 IAS 38: Intangible assets -189 -44 648 IFRS 9: Financial assets measured at fair value through other comprehensive income 4 074 4,074 IFRS 3: Fair value of buildings 110 170 108 118 Others -27 028 -27 043



* Contingent tax assets and liabilities Some of the subsidiaries have accumulated tax losses that are limited or not over time capital allowances limited or not over time. Due to the instability which may exist in these countries with regards to the evolution of tax legislation or its application, no deferred tax assets have been booked related to these tax latencies. Brabanta, Salala Rubber Corporation, and Socfin Agricultural Company have unused tax losses which recoverability is uncertain of EUR 21.9 million, EUR 13.8 million and EUR 8.5 million respectively as at 31st December 2019. Socfinaf has unused tax losses of EUR 51.5 million. Okomu and PSG have unused capital allowances as part of investment incentives for EUR 2.5 million and EUR 7.7 million. No deferred tax assets have been booked in respect of these tax latencies.

Note 11. Inventory

Carrying value of inventories by category

2019 2018

EUR EUR

Raw materials 22 328 310 19 506 032

Consumables 23 211 146 22 884 294

Spare parts 17 967 576 0

Production in progress 1 046 693 768 161

Finished products 15 206 058 14 966 661

Down-payments and orders in progress 4 840 303 2 170 574

Gross amount before impairment as at 31st December 84 600 086 60 295 722

Inventory write-downs -4 826 296 -1 321 502

Net amount as at 31st December 79 773 790 58 974 220

In 2019, the Group reclassified spare parts that were presented as fixed tangible assets. A review of spare parts inventories showed that these parts are interchangeable and do not meet the criteria for classification as fixed tangible assets. In 2018, the inventory of spare parts presented as fixed tangible assets amounted to EUR 14.2 million.


* Reconciliation of inventories

2019 2018

EUR EUR

Balance as at 1st January 60 295 722 56 541 906

Change in inventory 23 422 854 6 493 296

Fair value of agricultural products 762 313 -3 414 137

Foreign exchange 119 197 674 657

Gross amount (before impairment) as at 31st December 84 600 086 60 295 722

Inventory write-downs -4 826 296 -1 321 502

Net amount as at 31st December 79 773 790 58 974 220

The variation in inventories reflects the reclassification of spare parts for EUR 14.2 million in 2019. * Quantity of inventory by category

2018

Raw Materials Production-in-progress

Finished goods

Palm oil (tons) 0 0 8 819

Rubber (tons) 25 099 0 8 678

Others (units) 0 0 2 139 537

2019

Raw Materials

Production-in-progress

Finished goods

Palm oil (tons) 751 0 7 987

Rubber (tons) 27 973 0 8 621

Others (units) 0 0 1 814 353

Note 12. Trade receivables (Current assets)

2019 2018 EUR EUR

Trade receivables 10 618 023 14 774 408

Advances and prepayments 13 555 456 2 620 107

Net total as at 31st December 24 173 479 17 394 515 Advances and down-payments mainly comprise of Okomu's down-payments for the construction of an oil mill amounting to EUR 12 million in 2019. The value adjustments on trade receivables amounted to EUR 1.8 million in 2019 and EUR 1.7 million in 2018.


Note 13. Other receivables (current assets)

2019 2018

EUR EUR

Social security 959 154 1 321 912

Other receivables 13 158 805 13 813 760

Prepayments 566 381 559 363

As at 31st December 14 684 340 15 695 035

Note 14. Current tax assets and liabilities

* Components of current tax assets

2019 2018 EUR EUR

As at 1st January 13 442 815 9 899 990

Tax income 1 188 709 77 789

Other taxes -284 274 1 851 109

Taxes paid or recovered -1 958 222 687 531

Tax adjustments -738 339 896 778

Foreign exchange -19 604 29 618

Current tax assets as at 31st December 11 631 085 13 442 815

* Components of current tax liabilities

2019 2018 EUR EUR

As at 1st January 19 718 139 23 016 718

Tax expense 23 468 291 17 311 248

Other taxes 23 272 001 23 322 667

Taxes paid or recovered -45 583 520 -43 894 451

Tax adjustments -2 500 592 -254 420


Current tax liabilities as at 31st December 18 520 497 19 718 139


Note 15. Cash and cash equivalent

* Reconciliation with the amounts in the statement of financial positions

2019 2018

EUR EUR

Current account 39 056 804 34 700 835


* Reconciliation with the cash flow statement

2019 2018

EUR EUR

Current account 39 056 804 34 700 835

Bank overdrafts -10 184 245 -38 942 320

Balance as at 31st December 28 872 559 -4 241 485

Note 16. Share capital and share premium

Subscribed and fully paid up capital amounted to EUR 35.67million as at 31st December 2019 and 2018. There is a share premium of EUR 87.5 million added to the subscribed capital. At 31st December 2019, the share capital is represented by 17 836 650 shares. In accordance with the law passed on 28th July 2014 on the immobilization of bearer shares, 17 550 shares (i.e. 0.10% of the capital) have been cancelled, the holders of these shares having not registered with the depositary. The proceedings with the Caisse de Consignation are still in progress to date.

Ordinary shares 2019 2018

Number of shares as at 31st December 17 836 650 17 836 650

Number of fully paid shares issued, with no designation of par value 17 836 650 17 836 650


Note 17. Legal reserves According to the legislation in force, an allocation to a legal reserve of 5% must be done annually from the net profits of the parent company after absorption of any losses carried forward. This allocation to the legal reserve ceases to be mandatory when the reserve reaches 10% of the share capital.

Note 18. Pension obligations

Defined benefit pension plan and post-employment sickness Besides the legislation on social security applicable locally, most of the employees of the Group in Africa enjoy a defined benefit pension plan. The subsidiaries pay benefits in the event of retirement and depending on countries, also in case of dismissal. The benefits paid are calculated as a percentage of salary and are based on the number of years of service. The benefits payable to the employees are not financed by any specific asset against the provisions.

2019 2018

EUR EUR

Assets and liabilities recognized in the statement of financial position

Present value of obligations 9 729 372 9 849 311

Net amount recognized in the statement of financial position for defined benefit plans

9 729 372 9 849 311

Components of the net charge

Costs of services rendered 625 925 488 895

Financial costs 1 335 905 959 974

Actuarial gains and losses recognised during the year 83 832 0

Defined benefit plan costs 2 045 662 1 448 869 Movements in liabilities / net assets recognized in the statement of financial position

At 01st January 9 849 311 8 737 088

Costs as per income statement 2 045 672 1 448 869

Contributions -960 450 -1 269 609

Actuarial gains and losses of the year recognized in other comprehensive income

-1 325 366 742 590


As at 31st December 9 729 372 9 849 311

Provisions have been calculated based on actuarial valuation reports prepared in February 2020.


Actuarial gains and losses recognised in other comprehensive income

2019 2018

EUR EUR

Adjustments of liabilities related to experience 508 948 135 343

Changes in financial assumptions related to recognized liabilities 994 493 -626 922

Changes in demographic assumptions related to recognized liabilities -178 075 -251 010

Actuarial gains and losses recognized during the period in other comprehensive income

1 325 366 -742 590

Actuarial valuation assumptions 2019 2018

AFRICA

Average discount rate 6.92 to 20.96% 6.75 to 21.22%

Future salary increases 2 to 20% 1.74 to 18.99%

Average remaining active life of employees (in years) 19.80 20.05 Sensitivity Analysis of the Present Value of Defined Benefit Obligations

The table below shows the present value of the obligations when the main assumptions are changed.

2019 2018

EUR EUR Actuarial value of the obligation 9 729 372 9 849 311 Actuarial rate

Increase of 0.5% 9 428 484 9 540 751

Decrease of 0.5% 10 027 286 10 155 021

Expected future salary increases

Increase of 0.5% 10 017 706 10 144 755

Decrease of 0.5% 9 435 313 9 548 075 The sensitivity analysis is based on the same actuarial method used to determine the value of the obligations of the defined benefit plans. Impact of the defined benefit pension plan on future cash flows

2020 2019

Estimated contributions for the next financial year (in euros) 1 101 231 841 250

2019 2018

Weighted average duration of defined benefit plan obligations (in years) 6.1 6.1

Defined contribution pension scheme

2019 2018 EUR EUR

Total defined contribution pension plan 1 387 411 1 456 429


Note 19. Financial debts

2018

EUR Due within 1 year

Due later than 1 year

TOTAL

Loans held by financial institutions 14 558 570 19 603 161 34 161 731

Short term bank loans 38 942 320 0 38 942 320

Other loans 50 619 135 90 274 878 140 894 013

TOTAL 104 120 025 109 878 039 213 998 064

2019

EUR Due within 1 year

Due later than 1 year

TOTAL

Loans held by financial institutions 13 030 173 64 189 292 77 219 465

Short term bank loans 1 099 533 7 903 924 9 003 457

Bank overdrafts 10 184 245 0 10 184 245

Other loans 52 853 495 94 746 542 147 600 037

TOTAL 77 167 446 166 839 758 244 007 204

Most of the consolidated borrowings are denominated in Euros or CFA francs, whose parity is linked to the Euro. The fixed interest rates from financial institutions and which are pegged to the Euro vary between 4.90% and 6.00%. As explained in Note 34, interest rate management is the subject of ongoing management attention. * Analysis of Long-term debt by interest rate

2018

EUR Fixed rate Rate Variable

rate Rate TOTAL

Loans held by financial institutions

Ivory Coast 1 548 538 5.50% to 6.00% 0 - 1 548 538

Nigeria 5 816 243 9.00% to 10.00% 0 - 5 816 243

Liberia 163 755 8.00% 0 - 163 755

Cameroon 12 074 625 4.90% to 6.00% 0 - 12 074 625

19 603 161 0 19 603 161

Other loans

Europe 90 000 000 4.80% 0 - 90 000 000

Nigeria 105 947 - 0 - 105 947

Ivory Coast 168 931 - 0 - 168 931

90 274 878 0 90 274 878

TOTAL 109 878 039 0 109 878 039


2019

EUR Fixed Rate Rate Variable

Rate Rate TOTAL


Ivory Coast 12 978 252 5.50% to 6.50% 0 - 12 978 252

Nigeria 23 862 284 8.00% to 10.00% 0 - 23 862 284

Liberia 1 335 232 8.00% 0 - 1 335 232

Cameroon 12 498 473 5.00% to 7.09% 0 - 12 498 473

Ghana 13 000 003 4.00% 0 13 000 003

Sao Tomé 515 048 8.00% 0 515 048

64 189 292 0 64 189 292

Other loans

Europe 90 000 000 4.80% 0 - 90 000 000

Nigeria 2 713 888 3.00% 0 - 2 713 888

Ivory Coast 2 032 654 6.00% 0 - 2 032 654

94 746 542 0 94 746 542

TOTAL 158 935 835 0 158 935 835

* Long-term debts analysis by currency

2018 EUR CFA NGN USD TOTAL EUR

Loans held by financial institutions 0 13 623 162 5 816 243 163 756 19 603 161

Other loans 90 000 000 168 932 105 946 0 90 274 878

TOTAL 90 000 000 13 792 094 5 922 189 163 756 109 878 039

2019 EUR CFA NGN STN USD GHS CDF TOTAL EUR


13 000 003 25 476 725 23 862 284 515 048 1 335 232 0 0 64 189 293

Other loans 90 000 000 2 032 655 0 0 2 713 888 0 0 94 746 542

Lease liabilities 0 5 955 517 285 681 309 896 1 251 400 52 527 48 902 7 903 923

TOTAL 103 000 003 33 464 897 24 147 965 824 944 5 300 520 52 527 48 902 166 839 758


* Long-term debt analysis by maturity 2018

EUR 2020 2021 2022 2023 2024 and

later TOTAL


8 512 392 5 025 977 2 967 316 2 634 833 462 643 19 603 161

Other loans 0 90 000 000 0 0 274 878 90 274 878

TOTAL 8 512 392 95 025 9777 2 967 316 2 634 833 737 521 109 878 039 2019

EUR 2021 2022 2023 2024 2025

and later TOTAL


13 416 719 12 549 036 13 798 354 8 701 982 15 723 202 64 189 293

Lease liabilities 820 639 236 320 109 015 113 716 6 624 234 7 903 924 Other loans 3 730 214 91 016 327 0 0 0 94 746 541

TOTAL 17 967 572 103 801 683 13 907 369 8 815 698 22 347 436 166 839 758

* Net debt 2019 2018 EUR EUR

Cash and cash equivalents 39 056 804 34 700 835

Long term debt net of current portion -158 935 834 -109 878 039

Short term debt and current portion of long-term debt -76 067 913 -104 120 025

Lease liabilities -9 003 456 0

Net debt -204 950 399 -179 297 229

Cash and cash equivalents 39 056 804 34 700 835

Fixed interest rate bearing loans -235 003 747 -213 998 064

Variable interest rate bearing loans 0 0

Lease liabilities -9 003 456 0

Net debt -204 950 399 -179 297 229


* Reconciliation of net debt

EUR Cash and

cash equivalents

Long term debt, net of

current portion

Short term debt and

current portion of long term

debt

Debt related to

leases Total

As at 1st January 2018 23 800 263 -123 654 846 -60 500 905 0 -160 355 488

Cash flow 10 404 986 -13 029 558 -16 089 037 0 -18 713 609

Foreign exchange 495 586 -210 138 -513 580 0 -228 132

Transfers 0 27 016 503 -27 016 503 0 0

As at 31st December 2018 34 700 835 -109 878 039 -104 120 025 0 -179 297 229

Cash flow 4 198 042 -77 773 143 57 555 206 -8 461 007 -24 480 902

Foreign exchange 157 927 744 600 -7 856 -37 495 857 176

Transfers 0 27 970 748 -29 495 238 0 -1 524 490 Other movements with no impact on cash flow 0 0 0 -504 954 -504 954

As at 31st December 2019 39 056 804 -158 935 834 -76 067 913 -9 003 456 -204 950 399

Note 20. Other payables

2019 2018

EUR EUR

Staff cost liabilities 5 304 994 5 465 894

Other payables (*) 155 788 204 152 886 126

Accruals 1 157 750 844 072


Non-current liabilities 8 001 207 7 739 836

Current liabilities 154 249 741 151 456 256 (*) Other payables consist mainly of shareholder loans amounting to EUR 40.4 million (EUR 40.4

million in 2018) as well as debt of EUR 100.5 million (EUR 99.1 million in 2018) relating to the cash pooling at the level of Socfinaf S.A.


Note 21. Financial Instruments

2018

Derivative instruments

(*)

Loans and borrowings

Financial assets at fair value

through other comprehensive

income

Other financial

assets and liabilities

TOTAL Loans and Borrowing

Other financial

assets and liabilities

EUR At fair value At cost At fair value At cost

At fair value At fair value

Assets

Financial assets at fair value through other comprehensive income 0 0 91 902 0 91 902 0 0

Long-term advance payments 0 1 244 975 0 297 075 1 542 050 1 244 975 297 075

Other current assets 0 0 0 80 693 80 693 0 80 693

Trade receivables 0 0 0 17 394 515 17 394 515 0 17 394 515

Other receivables 0 0 0 15 695 035 15 695 035 0 15 695 035

Cash and cash equivalent 0 0 0 34 700 835 34 700 835 0 34 700 835

Total assets 0 1 244 975 91 902 68 168 153 69 505 030 1 244 975 68 168 153

Liabilities Long term debts 0 109 878 039 0 0 109 878 039 109 886 483 0

Other non-current payables 0 0 0 7 739 836 7 739 836 0 7 739 836

Short term debts 0 65 177 705 0 38 942 320 104 120 025 65 177 705 38 942 320

Trade payables (current) 0 0 0 44 786 254 44 786 254 0 44 786 254

Other payables (current) 0 0 0 151 456 256 151 456 256 0 151 456 256

Total liabilities 0 175 055 744 0 242 924 666 417 980 410 175 064 188 242 924 666

2018 Fair Value

EUR Level 1 Level 2 Level 3 TOTAL

Financial assets at fair value through other comprehensive income 0 0 91 902 91 902


2019 Derivative

instruments (*)

Loans and borrowings

Financial assets at fair value through

other comprehensive

income

Other financial

assets and liablities

TOTAL Loans and Borrowing

Other financial

assets and liablities

EUR At fair value At cost At fair value At cost

At fair value At fair value

Assets

Financial assets at fair value through other comprehensive income

0 0 91 902 0 91 902 0 0

Long term advance payments 0 1 623 672 0 321 105 1 944 777 1 623 672 321 105 Other non-current assets 0 0 0 1 669 262 1 669 262 0 1 669 262 Trade receivables 0 0 0 24 173 479 24 173 479 0 24 173 479

Other receivables 0 0 0 14 684 340 14 684 340 0 14 684 340

Cash and cash equivalent 0 0 0 39 056 804 39 056 804 0 39 056 804

Total Assets 0 1 623 672 91 902 79 904 990 81 620 564 1 623 672 79 904 990

Liabilities

Long term debts 0 158 935 834 0 0 158 935 834 158 938 040 0

Long term debt related to leases 0 7 903 924 0 0 7 903 924 7 903 924 0

Other non-current payables 0 0 0 8 001 208 8 001 208 0 8 001 208

Short term debts 0 65 883 668 0 10 184 245 76 067 913 65 883 668 10 184 245

Short term debt related to leases 0 1 099 533 0 0 1 099 533 1 099 533 0

Trade payables (current) 0 0 0 47 655 804 47 655 804 0 47 655 804

Other payables (current) 0 0 0 154 249 740 154 249 740 0 154 249 740

Total Liabilities 0 233 822 959 0 220 090 997 453 913 956 233 825 165 220 090 997

2019 Fair Value EUR Level 1 Level 2 Level 3 TOTAL

Financial assets at fair value through other comprehensive income 0 0 91 902 91 902

(*) Changes recognised in other comprehensive income


Note 22. Staff costs and average number of staff

2019 2018 EUR EUR

Staff Costs

Remuneration 61 140 236 58 330 451

Social security and pension expenses 6 270 284 5 845 615

Total as at 31st December 67 410 520 64 176 066

Average number of employees in the year 2019 2018

Directors 108 93

Employees 3 951 3 754

Workers (including temporary workers) 20 107 18 860

TOTAL 24 166 22 707

Note 23. Depreciation and impairment expense

2019 2018

EUR EUR

Depreciation

Of right-of-use assets (Note 3) 1 218 431 0

Of intangible Assets (Note 4) 82 462 599 046 Of property, plant and equipment excluding biological assets (Note 5) 28 785 376 26 645 361

Of biological assets (Note 6) 19 865 467 16 531 469

Impairment

Of biological assets (Note 6) 0 3 111 747



Note 24. Impairment of assets

Goodwill Impairment tests on goodwill are performed at least once a year to assess whether the carrying amount is still appropriate.

Intangible and tangible assets and right-of-use assets Every closing date, the Group reviews the carrying amount of its intangible and tangible assets and right-of-use assets in order to assess whether there is any indication of impairment at each reporting date. If such indication exists, the recoverable amount of the asset is estimated to determine, the amount of the impairment loss. As at 31st December 2019, no impairment was recognised on above mentioned assets.

Bearer biological assets Each reporting date, the Group assesses if there is any indication that its biological assets may be impaired. For this purpose, the Group assesses several indicators:

The significant and sustained decreasing trend in the prices of natural rubber (TSR20 1st position on SGX) and crude palm oil (CIF Rotterdam) was considered an observable sign that the biological assets may have been impaired. A decrease in these prices at reporting date greater than 15% compared to an average of 5-year value has been set by the Group to be an impairment sign. At 31st December 2019, the decrease in prices does not exceed 15% of the average price over the past 5 years for the rubber and palm segment. The Group considers, as well, average prices over the six months before reporting date and average prices over the last twelve months instead of only closing prices to avoid seasonal fluctuations in the prices of supply materials. The Group reviews also the prices observed on local market and considers a decrease in these prices at the closing date of more than 15% compared to an average of values over 5 years as an impairment indication. Based on these criteria, for the Rubber segment, the fall in prices observed during the financial year 2019 does not exceed 15% of the average prices over the past 5 years. For the Palm segment, the review of global prices shows a positive conclusion. However, based on local prices, the fall in prices observed during the financial year 2019 exceeded the same threshold of 15% only for SOGB. In addition to these external indicators, the Group considers the following indicators:

- Internal performance indicators; - Criteria relating to the local market; - Physical indicators of impairment; - Significant changes in plantations that could have a material impact on their future cash flows.

If an indication of impairment is identified, the recoverable amount of the bearer biological assets is determined.

Impairment tests must be performed on the smallest identifiable group of assets which generates cash flows independently of other assets or groups of assets and for which the Group prepares financial information for the Board of Directors.


The identification of CGUs depends, in particular, on: - how the Group manages the activities of the entity; - the way in which decisions are made with regards to the pursuit or the disposal of its

activities and; - the existence of an active market for all or part of the production.

The CGU consists of the operating segment within each entity. In fact, decisions related to daily activities such as sales, purchases, planting, replanting and human resources management are taken directly by the company itself, independently of other companies within the Group which operates in the same country and within the same operating segment as defined by IFRS 8. The recoverable amount of bearer biological assets is determined from the calculation of value in use using the most recent information approved by the local management. The Group uses the discounted value of expected net cash flows which are discounted at a pre-tax rate. At reporting date, the financial projection incorporates the full exploitation of the younger bearer biological assets. The operational life ranges between 25 and 30 years for both crops. This period can be adapted according to the particular circumstances for each entity. In 2019, the pre-tax discount rate ranges between 6.2% and 16.3% (between 7.9% and 20.8% in 2018). This rate reflects market interest rates, the company's capital structure taking into account the operating segment and the specific risk profile of the business. The value in use calculation has been very sensitive to:

- Changes in the margins achieved by the entity and - changes related to discount rates.

Changes in realized margins

Initially, the Group determines separately the expected production of each category of bearer biological assets within the entity over their remaining life. This expected production is estimated on the basis of the surface areas planted at reporting date as well as the actual crop yield recorded during the financial year which depends on the maturity of the bearer biological asset. Production is then valued on average basis of five-year of the margins achieved by the entity in relation to agricultural activities. The value in use of the bearer biological asset is then obtained by discounting these cash flows. Average margins are considered constant over the duration of the financial projection. An indexing factor is not taken into account. Based on the existence of an impairment loss index for the palm sector and following subsequent impairment tests, no impairment loss was considered necessary for SOGB. At 31st December 2019, accumulated impairment losses in the palm business segment amounted to EUR 11.3 million for Brabanta, EUR 5.7 million for PSG, EUR 4.3 million for Socfin Agricultural Company and EUR 3.1 million for Agripalma. For the rubber segment, the accumulated impairment losses are EUR 2.1 million for PSG, EUR 1.4 million for Safacam and EUR 24 million for Salala Rubber Company (Note 6).

Note 25. Other financial products

2019 2018 EUR EUR

Interest on receivables and cash flows 381 723 1 156 224

Exchange gains 2 372 777 3 164 177

Others 185 802 181 990

As at 31st December 2 940 302 4 502 391


Note 26. Finance charges 2019 2018 EUR EUR

Interest and finance charges 11 387 352 10 900 962

Interest expense linked to leased contracts 910 029 0

Exchange losses 3 092 607 2 749 268

Others 1 308 709 1 080 368

As at 31st December 16 698 697 14 730 598

Note 27. Tax expense

* Components of the tax expense

2019 2018 EUR EUR

Current income tax expense 23 936 077 18 286 288

Deferred tax expense/(income) -418 117 -875 748

Tax expense as at 31st December 23 517 960 17 410 540

* Components of the deferred tax expense (income)

2019 2018 EUR EUR

IAS 19: Retirement commitments -458 944 -156 788

IAS 38: Intangible assets 235 362 135 990

IAS 2 / IAS 41: Fair value of agricultural produce 229 975 -398 437

IFRS 3: Fair valuation buildings -27 -15 010

IAS 12: Tax latencies 484 464 1 061 473

IAS 16: Tangible assets -1 123 494 -1 889 006

IAS 37: Provisions for risks and charges 45 348 153 280

IAS 21: Foreign exchange differences 12 761 48 357

IFRS 16: Leases -2 012 0

Other 158 450 184 393

Deferred tax expense/(income) as at 31st December -418 117 -875 748


* Reconciliation of income tax expense 2019 2018

EUR EUR

Profit before tax from continuing operations 33 605 578 31 670 114

Normal tax rate of the parent company 24.94% 26.01% Normal tax rate of subsidiaries 24.9% to 38.5% 25% to 38.5%

Income tax at normal tax rates of subsidiaries 13 325 503 12 822 578

Unfunded taxes 18 863 246 745

Definitively taxed income 196 744 547 739

Use of capital allowances -11 077 000 -7 707 617

Specific tax regimes in foreign countries 6 527 810 2 844 196

Non-taxable income -58 928 -103 660

Non-deductible expenses 3 001 519 3 666 062

Use of accumulated tax losses 0 -235 350

Losses carried forward 7 982 499 5 470 245

Other tax benefits -510 704 -132 631

Additional tax assessment 4 270 879 247 963

Impact of change in tax rate -155 778 0

Other adjustments -3 447 -255 730

Tax expense as of 31st December 23 517 960 17 410 540

*Change of rate for the subsidaries During 2019, Safacam's tax rate dropped from 33% to 27.5%. This rate applies in Cameroon to companies that issue bonds over the duration of the bonds, i.e. 3 years for Safacam. Following the 2017 reform, the tax rate for Socfinaf changed from 26.01% in 2018 to 24.94% in 2019. SAFA's tax rate has dropped from 33% to 28%. * Tax adjustments The tax authorities have made an upward adjustment to Okomu's income tax expense by EUR 3.7 million following a deferral of deductions related to investment expenditures charged against the tax base in previous years. These investment expenditures are deductible from the tax base when the related assets start producing. Okomu deducted EUR 28.2 million from the tax base for the 2019 financial year in respect of investments made in previous financial years.


Note 28. Net earnings per share Undiluted net earnings per share (basic) is the profit for the year attributable to ordinary shareholders divided by the average number of common shares outstanding during the year. As there are no potential dilutive ordinary shares, the diluted net earnings per share is identical to the undiluted net earnings per share.

2019 2018

Net profit for the year (in Euro) 1 577 834 4 763 789

Average number of shares 17 836 650 17 836 650

Undiluted net earnings per share (in Euro) 0.09 0.27

Note 29. Dividends and directors’ fees

The Board will propose to the Annual General Meeting of 26th May 2020 the non-payment of dividend.

Note 30. Information on related party

*Directors’ remuneration

2019 2018

EUR EUR

Short term benefits 982 916 1 068 805

Post-employment benefits 0 0

Other long-term benefits 0 0

Termination benefits 0 0

Share-based payment 0 0


* Other related party transactions

2018

EUR Parent Associates Other

related parties

TOTAL

Non-Current Assets


0 230 000 0 230 000

Current Assets

Trade receivables 0 11 153 256 0 11 153 256

Other receivables 0 1 485 853 7 892 1 493 745

0 12 639 109 7 892 12 647 001

Non-Current Liabilities

Financial debts 90 000 000 0 0 90 000 000

90 000 000 0 0 90 000 000

Current Liabilities

Financial debts 50 619 135 0 0 50 619 135

Trade payables 0 20 632 872 1 803 20 634 675

Other payables 0 101 405 614 40 442 307 141 847 921

50 619 135 122 038 486 40 444 110 213 101 731

TRANSACTIONS BETWEEN RELATED PARTIES

Services and goods delivered 0 149 509 886 0 149 509 886

Services and goods received 0 36 943 396 106 236 37 049 632

Financial income 0 25 203 149 129 174 332

Finance expense 5 508 154 808 248 1 600 000 7 916 402


2019

EUR Parent Associates Other

related parties

TOTAL

Non-current assets


Current assets

Trade receivables 0 8 429 182 1 083 8 430 265

Other receivables 0 3 306 710 7 695 3 314 405

0 11 735 892 8 778 11 744 670

Non-current liabilities

Financial debts 90 000 000 2 713 886 0 92 713 886

Current liabilities

Financial debts 36 287 369 0 0 36 287 369

Trade payables 0 19 347 048 0 19 347 048

Other payables (Note 21) 0 104 230 494 40 403 288 144 633 782

36 287 369 123 577 542 40 403 288 200 268 199

TRANSACTIONS BETWEEN RELATED PARTIES

Services and goods delivered 0 167 813 011 0 167 813 011

Services and goods received 0 29 395 707 28 810 29 424 517

Financial income 0 22 843 0 22 843

Finance expense 5 141 833 794 581 1 600 000 7 536 414

Related party transactions are made on commercial terms. Transactions relating to other related parties are carried out with Bolloré Participations and Palmboomen Cultuur Maatschappij (Mopoli). Mopoli is a Dutch company which is majority owned by Financière Privée Holding and Afico, which also owns Socfin. Bolloré Participations is a shareholder and director of Socfinaf. In 2014, Socfinaf obtained a cash advance of EUR 35 million from Mopoli. This advance bears an annual interest (net of tax) of 4%. Interest is payable in arrears at the end of each calendar quarter. The amount of interest recognized for the year 2019 is EUR 0.8 million. As at 31st December 2019, the outstanding balance amounts to EUR 20.2 million. In 2016, Socfinaf obtained a loan of EUR 20 million from Bolloré Participations. The loan has an annual interest rate of 4%. The amount of interest recognized for the year 2019 is EUR 0.8 million euros. As at 31st December 2019, the outstanding balance amounts to EUR 20.2 million. Socfinaf S.A. did not pay any dividend in 2019 to its parent company Socfin (2018: EUR 1.1 million). Socfinaf has borrowed an amount EUR 126.3 million from Socfin. An annual interest at rates ranging from 2.25% to 4.8% is payable on these loans. As such, Socfinaf S.A has paid an interest of EUR 5.1 million in 2019 compared to EUR 5.5 million in 2018.


Note 31. Off balance sheet commitments In 2009, a subsidiary of Socfinaf S.A., Salala Rubber Corporation (SRC), obtained a loan of USD 10 million which contracts stipulate that Socfinaf S.A. must pledge 123 shares it holds in the Company in favour of the bank. In 2012, Liberian Agricultural Company (LAC) purchased 99 shares of Salala Rubber Corporation (SRC) from Agrifinal that are also pledged to the bank under this loan. As at 31st December 2019, the balance of the loan amounted to EUR 0.2 million (2018: EUR 0.9 million). In 2014, a subsidiary of Socfinaf S.A., SOGB SA obtained a loan of 3 billion CFA francs (EUR 4.6 million), which contract stipulates that SOGB SA pledges as mortgage guarantee the professional equipment up to the amount of the loan. As at 31st December 2019, the loan is fully repaid (2018: EUR 0.9 million). In 2014, a subsidiary of Befin, Sud Comoë Caoutchouc (SCC), obtained a loan for a total amount of 2.68 billion CFA francs (EUR 4.1 million), the contracts of which stipulate that SCC has entered into an insurance assignment for the benefit of the bank up to the amount of the loan granted. SCC has also pledged professional equipment as mortgage collateral up to 1 billion CFA francs (EUR 1.5 million) for. As at 31st December 2019, the loan is fully repaid (2018: EUR 0.6 million). In 2015, a subsidiary of Socfinaf S.A., Okomu Palm Oil Company Plc obtained a loan of 2 billion Naira, whose contract stipulates that Okomu will pledge as mortgage guarantee, up to the amount of loan granted, the 11 000 ha plantation financed by the loan. As at 31st December 2019, the balance of the loan amounts to EUR 1 million (2018: EUR 2.2 million). In 2019, Okomu obtained a loan of 10 billion Naira, which contract stipulates that Okomu will pledge the 11 416 ha plantation financed by the loan as mortgage guarantee, up to the amount the loan granted. As at 31st December 2019, the balance of the loan amounts to EUR 20 million. Socapalm S.A. entered into a credit agreement of 3 billion CFA francs (EUR 4.6 million), which contract stipulates that Socapalm has agreed to make no guarantees to other creditors on its assets without benefiting the bank. As at 31st December 2019, the loan is fully repaid (2018: EUR 0.8 million). In 2019, a subsidiary of Socfinaf S.A., Agripalma LDA entered into a credit agreement of 49 million Dobra (EUR 2 million), which contract stipulates that Agripalma pledges the professional facilities and equipment as mortgage guarantee, up to the amount of the loan granted. As at 31st December 2019, the balance of the loan amounts to EUR 2 million. In 2019, a subsidiary of Socfinaf S.A., PSG Ghana, obtained a loan of EUR 16.5 million for the construction of an oil mill. This loan consists of a credit line of EUR 15 million and a bank overdraft of EUR 1.5 million. The contract stipulates that PSG Ghana pledges the oil mill as mortgage guarantee, up to the amount of the loan granted. As at 31st December 2019, the balance of the loan amounts to EUR 13 million and the overdraft to EUR 1 million.


Note 32. Agricultural leases The Group does not own all the land on which the biological assets are planted. In general, these lands are subject to very long-term concessions from the local public authority. These concessions are renewable.

Company (*) Date of initial lease or renewal/

extension

Duration of the initial

lease

Area conceded

SOCFIN AGRICULTURAL COMPANY « SAC » 2011/2012/2013/2014

50 years 18 473 ha (1)

LIBERIAN AGRICULTURAL COMPANY « LAC » 1959

77 years 121 407 ha

SALALA RUBBER CORPORATION « SRC » 1960

70 years 8 000 ha (3)

SOGB S.A. 1995

99 years 34 712 ha

PLANTATIONS SOCFINAF GHANA 2013/2016

50 years 18 303 ha

OKOMU OIL PALM COMPANY PLC 2001/2013

92 to 99 years 33 113 ha

SOCAPALM S.A. 2005

55 years 58 063 ha

AGRIPALMA LDA 2009

25 years 4 917 ha (2)

BRABANTA S.A. 2015/2018/2019

25 years

8 362 ha (1) Renewable concessions for a term of 25 years. (2) Concessions renewable tacitly for periods of 25 years. (3) Extensible concessions up to 40 000 ha (*) SAFACAM S.A. owns 17 690 ha.

Note 33. Segment information

In accordance with IFRS 8, the analysis of information by management is based on the geographical distribution of political and economic risks. As a result, the sectors are Europe, Sierra Leone, Liberia, Ivory Coast, Nigeria, Cameroon, São Tomé and Principe and Congo (DRC). The products of the operating sectors of the Ivory Coast, Nigeria and Cameroon come from the sale of palm oil and rubber, those from the Liberia are only from the sale of rubber, those from Sierra Leone, Ghana, São Tomé and Principe and Congo ( DRC) come from the sale of palm oil only and those in the Europe sector come from the rendering of administrative services, assistance in managing the areas under plantation and the marketing of products outside the Group. The segment profit of the Group is the profit from operations. The stated figures originate from internal reporting. They do not include any consolidation or IFRS adjustments or restatements and are therefore not directly comparable to amounts reported in the consolidated statement of financial position and income statement.


* Segmental breakdown of profit/(loss) as at 31st December, 2018

EUR

Revenue from ordinary business

with external customers

Revenue from

ordinary business between segments

Sector profit/(loss)

Europe 0 0 -4 688 476

Sierra Leone 11 029 893 0 -4 733 655

Liberia 22 799 416 0 -1 929 772

Ivory Coast 119 946 162 0 8 133 538

Ghana 2 217 248 0 -2 890 589

Nigeria 56 249 469 0 23 858 396

Cameroon 121 129 028 0 29 181 567

São Tomé and Principe 153 665 0 -1 470

Congo (RDC) 11 049 186 0 -2 036 839

TOTAL 344 574 067 0 44 892 700

Depreciation, amortization and impairment of biological assets

-3 322 582 Fair value of agricultural produce

-3 414 137 Other IFRS adjustments

1 992 095 Consolidation adjustments (intragroup and others)

2 156 879 Financial income

4 531 911 Finance expense

-15 166 753 Group share of income from associates

4 934 657 Income tax expense

-17 410 540

Net profit for the year

19 194 231


* Segmental breakdown of profit/(loss) as at 31st December 2019

EUR

Revenue from ordinary business

with external customers

Revenue from

ordinary business between segments

Sector profit/(loss)

Europe 0 0 -3 719 987

Sierra Leone 12 457 250 0 -9 786 310

Liberia 29 750 036 0 -1 468 935

Ivory Coast 138 361 953 0 15 173 778

Ghana 2 886 587 0 -1 420 684

Nigeria 55 044 697 0 23 582 323

Cameroon 128 215 070 0 29 973 108

São Tomé and Principe 143 499 0 -1 186 795

Congo (DRC) 9 264 642 0 -4 185 777

TOTAL 376 123 734 0 46 960 721

Depreciation, amortization and impairment of biological assets

-3 257 401 Fair value of agricultural produce 762 313 Other IFRS adjustments

-359 831 Consolidation adjustments (intragroup and others)

2 345 236 Financial income

4 050 920 Finance expense

-16 896 380 Group share of income from associates

5 754 101 Income tax expense

-23 517 960

Net profit for the year 15 841 719


* Total segmental assets

2019 2018

EUR EUR

Europe 238 048 369 956

Sierra Leone 130 429 641 131 297 574

Liberia 108 821 884 105 107 735

Ivory Coast 147 428 103 146 305 465

Ghana 84 091 394 64 824 210

Nigeria 124 072 886 105 880 433

Cameroon 190 480 436 189 377 986

São Tomé and Principe 30 829 958 27 621 793 Congo (RDC) 67 171 882 70 637 792


IFRS 3/IAS 16 : Biological assets -14 662 771 -11 801 101

IAS 2/IAS 41: Agricultural produce 3 342 885 2 593 502

Other IFRS adjustments -6 188 270 -6 681 519

Consolidation adjustments (intragroup and others) -61 991 399 -46 297 748

Total consolidated segmental assets 804 064 678 779 236 078 Segment assets are not part of internal reporting, they are included to meet the requirements of IFRS 8. They include fixed assets, biological assets, trade receivables, inventories, cash and cash equivalents. They do not include any consolidation or IFRS adjustments.

* Total segmental liabilities

2019 2018

EUR EUR

Europe 141 254 816 140 605 701

Sierra Leone 5 489 175 3 311 191

Liberia 14 581 944 7 904 390

Ivory Coast 19 597 816 22 809 255

Ghana 1 602 209 2 989 471

Nigeria 3 812 768 2 793 836

Cameroon 17 841 896 23 383 711

São Tomé and Principe 2 459 231 537 032

Congo (DRC) 2 909 108 1 848 158


Other IFRS restatements -58 054 -56 762 Consolidation adjustments (intragroup and others) -7 585 365 -9 883 472

Total consolidated segmental liabilities 201 905 544 196 242 511


* Costs incurred for acquisition of segmental assets during 2018

EUR Intangible

assets Property, plant and equipment

Biological assets

TOTAL

Sierra Leone 0 5 356 297 4 873 407 10 229 704

Liberia 0 3 101 356 6 078 156 9 179 512

Ivory Coast 19 435 7 647 391 4 794 792 12 461 618

Ghana 0 9 834 982 4 811 286 14 646 268

Nigeria 0 9 317 853 9 569 904 18 887 757

Cameroon 156 270 13 998 263 2 732 613 16 887 146

São Tome and Principe 0 2 675 583 2 580 132 5 255 715

Congo (DRC) 0 719 851 8 529 728 380

TOTAL 175 705 52 651 576 35 448 819 88 276 100 * Costs incurred for acquisition of segmental assets during 2019

EUR Intangible

assets Property, plant and equipment

Biological assets

TOTAL

Sierra Leone 0 4 723 487 0 4 723 487

Liberia 0 1 207 820 5 393 720 6 601 540

Ivory Coast 24 534 4 512 806 2 395 829 6 933 169

Ghana 0 7 635 217 2 158 921 9 794 138

Nigeria 0 5 478 630 7 448 259 12 926 889

Cameroon 267 729 11 525 497 1 247 116 13 040 342

São Tomé and Principe 0 1 684 598 1 376 850 3 061 448

Congo (RDC) 0 297 573 365 297 938

TOTAL 292 263 37 065 628 20 021 060 57 378 951 * Information by category of revenue

Revenue from external customers

2019 2018

EUR EUR

Palm 209 870 679 206 065 645

Rubber 163 502 189 135 390 389

Others 2 750 866 3 118 033

TOTAL 376 123 734 344 574 067


* Information by geographical region Revenue from external customers by country and by geographical area

EUR 2018

Geographical location

Origin

Europe Ivory Coast Nigeria Cameroon Congo Sierra Leone

Other African

countries

Rest of the world TOTAL

Sierra Leone 250 677 0 589 672 914 659 0 1 638 332 7 636 559 0 11 029 897

Liberia 22 799 416 0 0 0 0 0 0 0 22 799 416 Ivory Coast 77 644 313 18 583 629 0 0 0 0 2 053 076 21 665 139 119 946 157

Ghana 0 0 0 0 0 0 2 217 248 0 2 217 248 Nigeria 8 112 017 0 48 137 452 0 0 0 0 0 56 249 469 Cameroon 9 897 776 0 0 110 635 082 0 0 596 170 0 121 129 028 São Tomé and Principe 0 0 0 0 0 0 153 665 0 153 665 Congo (DRC) 0 0 0 0 11 049 186 0 0 0 11 049 186

TOTAL 118 704 199 18 583 629 48 727 124 111 549 741 11 049 186 1 638 332 12 656 718 21 665 139 344 574 067

EUR

2019

Geographical location

Origin

Europe Ivory Coast Nigeria Cameroon Congo Sierra Leone Other

African countries

Rest of the world

TOTAL

Sierra Leone 673 235 0 0 332 537 0 9 427 621 2 023 857 0 12 457 250 Liberia 29 750 036 0 0 0 0 0 0 0 29 750 036 Ivory Coast 93 407 626 17 199 120 3 191 957 0 0 0 1 437 230 23 126 019 138 361 952 Ghana 0 0 0 0 0 0 2 886 587 0 2 886 587 Nigeria 0 0 55 044 697 0 0 0 0 0 55 044 697

Cameroon 8 721 082 10 500 0 119 443 181 0 0 40 308 0 128 215 070 São Tomé et Principe 0 0 0 0 0 0 143 500 0 143 500 Congo (DRC) 0 0 0 0 9 264 642 0 0 0 9 264 642

TOTAL 132 551 979 17 209 620 58 236 653 119 775 718 9 264 642 9 427 621 6 531 481 23 126 019 376 123 734


* Information by business segment and revenue category

Revenue from external customers by business segment and revenue category:

EUR 2018

Category

Business segment Palm Rubber

Other agricultural

products TOTAL

Sierra Leone 11 020 695 0 9 198 11 029 893

Liberia 0 22 799 416 0 22 799 416

Ivory Coast 20 467 237 97 296 046 2 182 879 119 946 162

Ghana 2 136 622 0 80 626 2 217 248

Nigeria 47 617 474 8 112 017 519 977 56 249 469

Cameroon 113 620 767 7 182 910 325 351 121 129 027

São Tomé and Principe 153 665 0 0 153 665

Congo (DRC) 11 049 186 0 0 11 049 186

TOTAL 206 065 645 135 390 389 3 118 032 344 574 067

EUR 2019

Category

Business segment Palm Rubber

Other agricultural

products TOTAL

Sierra Leone 12 297 304 0 159 947 12 457 250

Liberia 0 29 750 036 0 29 750 036

Ivory Coast 20 299 230 116 295 854 1 766 869 138 361 953

Ghana 2 848 255 0 38 332 2 886 587

Nigeria 46 092 422 8 735 218 217 057 55 044 697

Cameroon 118 925 326 8 721 082 568 661 128 215 069

São Tomé and Principe 143 499 0 0 143 499

Congo (DRC) 9 264 642 0 0 9 264 642

TOTAL 209 870 679 163 502 189 2 750 866 376 123 734


Note 34. Risk management

Capital Management The Group manages its capital and adjusts accordingly in response to changes in economic conditions and investment opportunities. To maintain or adjust the capital structure, the Group may issue new shares, repay part of the capital or adjust the payment of dividends to shareholders. On 31 December 2014, Socfinaf S.A. issued 1 474 200 new shares. Socfin fully subscribed to this capital increase and through a contribution in kind, it released 577,200 shares of Société Anonyme Forestière et Agricole SAFA. Financial Risk The financial risk for the companies within the Group comes mainly from changes in the selling price of agricultural commodities, foreign exchange and to a lesser extent, interest rate movements. Potential risks None of the countries in which the Group operates has a hyperinflationary economy or suffers from an immediate threat of price devaluation. Nevertheless, in a minority of countries in which the Group operates, the political system and economic stability remain fragile and could lead to currency devaluation or hyperinflation. Risk management and opportunities: The Group regularly reviews its sources of financing as well as currency movements and its decisions are based on a variety of risks and opportunities which are themselves based on several factors including interest rates, currency and counterparties. Market risk * Price risk in commodities market Potential risk: The Group markets its finished products at prices which may be influenced by commodity prices in international markets. It therefore faces the risk of volatility in the prices of these commodities Risk management and opportunities: The main policy of the Group's companies has always been to control its production costs in order to generate margins for the viability of structures in the event of a significant drop in the selling prices of raw materials and conversely to generate profit margins during the market downturns. In parallel with this main policy, secondary policies have also been implemented to improve or consolidate profit margins: - production of agricultural products of superior quality and branded, in particular for rubber

and; - use of the Group's expertise in the commerce sector. * Foreign currency risk Potential risk The Group carries out transactions in local currencies. In addition, financial instruments hedging against exchange rate fluctuations may not be available for certain currencies. This creates exposure to interest rate fluctuations which may have an impact on the financial result denominated in euros.


Risk Management and Opportunities Apart from the current currency hedging instruments for operational transactions - which remain relatively limited, the main policy of the Group to finance its development projects in local currencies in the region given the significant investments made in the plantations and wherever possible, to reduce borrowings. * Interest rate risk Potential risk: This risk includes a change in cash flows relating to short-term borrowings - often on a variable rate and the relatively high level of base interest rates on cash and cash equivalents and developing markets when borrowing in local currency. Risk Management and Opportunities: The first risk is put under control by an active policy of monitoring the evolution of local financial markets and sometimes short-term debt consolidation in the long term, if necessary. The second risk is taken into account by a systematic policy of putting local and international banks in competition with international lenders who can offer real investment and development opportunities at attractive rates. Credit Risk Potential risk: Credit risk arises from the potential inability of clients to meet their contractual obligations. Risk Management and Opportunities To manage this risk, the Group ensures the payment of local sales in cash or the guarantee of the receivables by obtaining approved bills of exchange. The export sales of the plantations are centralized in the Group's sales structure, which applies either a cash payment policy or a commercial credit policy whose limits are defined by its Board of Directors. Liquidity risk Potential risk: Liquidity risk is defined as the risk that the Group cannot meet its obligations on time or at a reasonable price. This risk is mainly impacting plantations which are both the main source of cash and financing needs. Risk Management and Opportunities: Given the specific economic and technological environment of each plantation, the Group manages this risk in a decentralized manner. However, both the cash available and the implementation of the financing are supervised by the Group Management. Emerging Market Risks

Potential Risk: Current or future political instability in certain countries in which the Group operates may affect the ability to do business, generate revenue and impact the Group's profitability. The political system in some of the Group's markets remains relatively fragile and remains potentially threatened by cross-border conflicts or wars between rival groups.


Risk Management and Opportunities The Group's activities contribute to improving the quality of life in the countries in which the Group operates while improving the stability of its markets may lead to an appreciation of the value of the Group's companies located locally. Diversifying the geographic mix of countries, economies and currencies in which the Group generates its revenues and cash flows reduces its exposure to emerging market risk. The Group is aware of the environmental and social responsibility it has towards the local population and is implementing initiatives to this end. Risk of expropriation Potential Risk Certain countries in which the Group operates have political regimes that may call into question foreign commercial interests by limiting their activities and may attempt to impose control over the Group's assets. Risk Management and Opportunities The diversification of the geographical distribution of the countries in which the Group generates its revenues and its cash flows reduces its exposure to this risk. Credibility risk Potential risk The Group is exposed to the risk of loss of confidence of the financial markets in relation to its ability to maintain a sound financial health considering: - its environmental impact, - its social responsibility and - the economic and geopolitical risks that certain Group entities may face. Risk Management and Opportunities: The Group has published its responsible management policy in 2017. This complements the Group's sustainable development commitments, formalized in 2012. The Group's initiatives to take this risk into account are detailed in the information provided in the annual sustainable development report available on request at Group headquarters. Risk sensitivity * Exchange rate Risk Local turnover of EUR 209.9 million in 2019 were made in the local currency. Export sales are made in dollar or euro. Where the currency from sale is not the functional currency of the company and that currency is linked to a strong currency, the conversion is ensured at the time of the conclusion of the contract. The impact on the result of a 5% increase or decrease (EUR/USD) in foreign currency financial instruments amounts to EUR 0.7 million. * Interest rate risk The breakdown of fixed rate loans and variable rate loans is described in Note 19. As at 31st December 2019, there are no loans associated with floating rates.


* Credit risk As at 31st December 2019, the trade receivables from local customers amount to EUR 24.2 million. Accounts receivable from global customers are mainly receivables related to the sale of rubber. Palm oil is sold locally to local players (wide range of customers). The marketing of rubber is entrusted to Sogescol FR (equity accounted company). It intervenes either on the physical markets or directly with end customers.

2019 2018 EUR EUR

Trade receivables 25 964 060 19 117 287

Provision under lifetime expected credit loss model (IFRS 9) -1 790 581 -1 722 772

Other receivables 14 684 340 15 695 035

Total net receivables 38 857 819 33 089 550

Amount not due 38 554 104 30 677 890

Amount due less than 6 months 112 045 70 819

Amount due for more than 6 months and less than one year 165 096 1 910 784

Amount due for more than one year 26 574 430 057

Total net receivables 38 857 819 33 089 550

* Liquidity risk The Group's exposure to liquidity risk is mentioned in Notes 15 and 19.

Note 35. Political and economic environment

The Company holds interests in subsidiaries operating in Africa. Given the economic and political instability in some of the related African countries (Sierra Leone, Liberia, Ivory Coast, Ghana, Nigeria, Cameroon, São Tomé and Principe and Congo DRC), these investments represent a risk in terms of exposure to political and economic changes.

Note 36. Events after the closing date

The Covid-19 epidemic began in China in December 2019 and spread to the rest of the world from January 2020 and rose to “pandemic” status on 11th March 2020 by the WHO. At the balance sheet date, the epidemic had no impact on the Group's activities. The Covid-19 epidemic, which took a global dimension, caused the financial markets to fall dramatically from mid-February onwards, raising fears of a slowdown in global economic growth. Raw material prices were obviously not spared. Thus, the TSR20 1st position FOB Singapore on SGX quoted on 27th March 2020 at USD 1 070 per ton, against USD 1 451 per ton on 31st December 2019. Similarly, the price of crude palm oil CIF Rotterdam closed on 27th March 2020 at around USD 620 per ton, against USD 850 per ton on 31st December 2019. The Covid-19 crisis has strongly affected sectors linked to the Chinese economy, particularly groups operating in the automotive industry, already in slowdown. In addition, tyre manufacturers are in the process of halting and/or drastically reducing production at most of their factories in Europe, North America, South America and elsewhere in the world.


The board of Directors expects a sharp decline in rubber demand from tyre manufacturers from April onwards. Slower growth in China and the recent lockdown in India, the two major palm oil importers, and falling oil prices are also weighing heavily on current crude palm oil prices. The situation is being closely monitored by the management teams. However, it is too early to assess the full impact of the Covid-19 epidemic on the financial year 2020. First quarter operations were not affected by this crisis. Moreover, 70% of palm oil is sold locally on markets that offer a price which is sustainably higher than the world market price.

Note 37. Auditor’s fees

2019 2018 EUR EUR

Audit (VAT included) 281 015 272 990

The audit fees include all fees paid to the independent statutory auditor of the Group (C-Clerc S.A., member of Crowe Global network) as well as those paid to member firms within their network for the year. No consulting work or other non-audit services have been performed by those companies in 2019 or in 2018.


Company’s Management report Presented by the Board of Directors at the Annual General Meeting of 26th May 2020 Ladies and gentlemen, We have the honour to present to you our annual report and to submit for your approval the annual accounts of our Company as at 31st December 2019. Activities Socfinaf S.A. holds financial interests in portfolio companies which operate directly or indirectly in tropical Africa in the rubber and palm oil sectors. The result of the exercise The profit and loss account for the year, compared to that of the previous year, is as follows: (million EUR) 2019 2018

INCOME Income from financial fixed assets 37.0 35.6 Reversal of value adjustment 0.0 0.1 Proceeds from financial elements of current assets 0.0 0.1

Total income 37.0 35.8

EXPENSES Impairment on financial assets 1.3 0.0 Other external charges 3.7 4.7 Interest payable and other financial expenses 7.5 8.6 Income tax 2.9 2.2

Total expenses 15.4 15.5

PROFIT OF THE PERIOD 21.6 20.3

Revenue from financial assets (EUR million) 2019 2018

Dividends Socapalm 10.5 8.0 Befin 8.7 7.7 Okomu 7.8 5.3 Sogescol FR 2.7 3.6 Socfinco FR 2.0 3.0 Safa 1.2 4.9 Others 0.5 1.0

Balance of dividends 33.4 33.5 Interest income on long term loan receivables amounted to EUR 2.5 million. A capital gain on the sale of Okomu shares of EUR 1 million was recorded. Profit for the year amounted to EUR 21.6 million compared to EUR 20.3 million in 2018.


Balance sheet As at 31st December 2019, Socfinaf S.A.'s total assets amounted to EUR 548.5 million compared to EUR 540.6 million as at 31st December 2018. Socfinaf S.A.'s assets mainly consist of financial fixed assets of EUR 239 million, long term loan receivables of EUR 304.1 million and other receivables for EUR 4.9 million. Equity amounted to EUR 280.9 million before appropriation of income. Portfolio Movements During the year 2019, Socfinaf sold 10 910 810 Okomu shares for an amount of EUR 1.4 million. Impairment losses on Sodimex and Socfin Research investments were recorded for a total amount of EUR 1.3 million. Valuation The investments are estimated at a total value of EUR 484.9 million and includes an unrealized gain of EUR 245.8 million compared to their acquisition costs, potentially adjusted. Investments The main direct and indirect investments have evolved during the last months as follows:


The production data correspond to the quantities in tons of Milled Rubber and Crude Palm Oil. This table does not include refined oil production data (SPFS). Rubber production and sales are presented after elimination of intercompany transactions. Consolidated figures may however differ.

The above table has not been translated and kept in its original French version. The key translation keys are as follows:

French English Projets en exploitation Projects in operation

Réalisé Realised

Chiffre d’Affaires Turnover

Resultat Net Net Result

Palmier Palm product

Surfaces Surface area

Production HPB Crude Production

Caoutchouc Rubber


Allocation of profit The profit for the year amounting to EUR 21 577 356.83, retained earnings of EUR 131 986 469.61 brought forward result in total earnings of EUR 153 563 826.44 which has been proposed to be carried forward. After this distribution of profit, total reserves will amount to EUR 157 819 503.36 and will be allocated as follows: Reserves EUR Legal reserve 3 567 330.00 Other reserves 628 717.42 Available reserve 59 629.50 Retained earnings 153 563 826.44

157 819 503.36 Treasury shares The Company did not buy back its own shares during the 2019 financial year. Research and development During the financial year 2019, Socfinaf S.A. did not incur any expenses for research and development. Financial instruments During the financial year 2019, the Company did not make use of any financial instruments. Financial risk management policies are described in the notes to the Company's consolidated financial statements. Branch The Company has a permanent establishment in Fribourg (CH). Mentions required by Art. 11 (1) points a) to k) of the law of 19 May 2006 concerning Public Takeover Bids a) b) f) The subscribed share capital of the Company is set at EUR 35 673 300 represented by

17 836 650 shares without par value, fully paid up. Each share entitles the holder to one vote without limitation or restriction.

c) On 1st February 2017, Socfin declared that it holds a 58.85% direct stake in Socfinaf S.A.

On 3rd September 2014, Compagnie du Cambodge declared that it holds a direct and indirect stake of 9% in the capital of Socfinaf SA. 7.07% is held by Compagnie du Cambodge, 1.08% by Société Industrielle et Financière de la Artois, 0.49% by Bolloré SA and 0.36% by Compagnie des Glénans.

h) Art. 13. of the statutes: "The Company is administered by a Board composed of at least three

members, whether natural or legal persons. The Directors are appointed for a period of six years by the General Meeting of Shareholders. They are eligible for re-election. The Directors are renewed by lottery, so that at least one Director will be leaving each year."


Art. 23. of the statutes: "In the event of the death or resignation of a Director, he may be provisionally replaced by observing in this respect the formalities provided for by law. In this case the General Assembly at its first meeting shall proceed to the final election.” Art. 32. of the statutes: "The present statutes can be modified by decision of the General Assembly specially convened for this purpose, in the forms and conditions prescribed by articles 450-3 and 450-8 of the law of 10th August 1915 on the commercial companies, as amended."

i) The powers of the members of the Board of Directors are defined in Art. 17 et seq. of the

statutes of the Company. They provide in particular that: "The Board of Directors is vested with the broadest powers for the administration of the Company. All matters not expressly reserved to the General Meeting by the Articles of Incorporation or the law fall within the competence of the Board."

In addition, the statutes provide in Art. 5 §3 and 4: "The authorized capital and the subscribed capital may be increased or reduced by decision of the Extraordinary General Meeting in a similar way as to the amendments to the articles of association.”

The Company may, to the extent and subject to the conditions permitted by law, repurchase its own shares."

The other points of Art. 11 (1) are not applicable, namely:

• title holding including special control rights; • the existence of a staff shareholding system; • shareholder agreements that may result in restrictions on the transfer of securities or voting

rights; • the agreements to which the Company is party, and which take effect are modified or

terminated in the event of a change of control of the Company following a takeover bid; • the indemnities provided in the event of the resignation or dismissal of members of the Board

of Directors or staff following a takeover bid. Corporate responsibility policy On 22nd March 2017, the Group adopted its new corporate responsibility policy. It is based on the four principles of responsible development, improvement of management practices, respect for human rights and transparency. An implementation plan for this policy has been defined and implemented throughout the 2019 financial year. The efforts and actions undertaken by the Socfin Group in this area are detailed in a dashboard regularly updated as well as in a separate annual report ("sustainable development report"). The responsible management policy, the dashboard and the annual sustainable development report are available on the Group's website. Estimated value of the share (company accounts) The estimated value of Socfinaf SA as at 31st December 2019 before appropriation of the result for the financial year amounts to EUR 526.8 million, being EUR 29.53 per share compared to EUR 30.80 in the previous financial year. This valuation incorporates the unrealized capital gains of the portfolio. As a reminder, the market share price was EUR 12.00 at the end of 2019 against EUR 11.40 a year earlier.


Significant events after the reporting date The Covid-19 epidemic began in China in December 2019 and spread to the rest of the world from January 2020 and rose to “pandemic” status on 11th March 2020 by the WHO. At the balance sheet date, the epidemic had no impact on the Group's activities. The Covid-19 epidemic, which took a global dimension, caused the financial markets to fall dramatically from mid-February onwards, rising fears of a slowdown in global economic growth. Raw material prices were obviously not spared. Thus, the TSR20 1st position FOB Singapore on SGX quoted on 27th March 2020 at USD 1 070 per ton, against USD 1 451 per ton on 31st December 2019. Similarly, the price of crude palm oil CIF Rotterdam closed on 27th March 2020 at around USD 620 per ton, against USD 850 per ton on 31st December 2019. The Covid-19 crisis has strongly affected sectors linked to the Chinese economy, particularly groups operating in the automotive industry, already in slowdown. In addition, tyre manufacturers are in the process of halting and/or drastically reducing production at most of their factories in Europe, North America, South America and elsewhere in the world. We expect a sharp decline in rubber demand from tyre manufacturers from April onwards. Slower growth in China and the recent lockdown in India, the two major palm oil importers, and falling oil prices are also weighing heavily on current crude palm oil prices. The situation is being closely monitored by the management teams. However, it is too early to assess the full impact of the Covid-19 epidemic on the financial year 2020. First quarter operations were not affected by this crisis. Moreover, 70% of palm oil is sold locally on markets that offer a price which is sustainably higher than the world market price Main risks and uncertainties It must be emphasized that the Group's investments in Africa may be subject to political and economic risks. On-site executives and managers follow the day-to-day evolution of the situation. Perspectives The result for the 2020 financial year will depend to a large extent on the dividend distributions of the subsidiaries; these are not yet fixed. Statutory appointments The term served as director by Administration and Finance Corporation « Afico » expires this year. At the next General Meeting, the Board of Directors will propose not to renew his mandate. The term served as director by Mr. François Fabri expires this year. At the next General Meeting, the Board of Directors will propose to appoint Mr. François Fabri as Executive Director for a term of six years until the Annual General Meeting of 2026. At the next General Meeting, the Board of Directors will propose to appoint Mr. Philippe Fabri as an additional Director for a term of six years until the Annual General Meeting of 2026 In addition, the mandate of the independent statutory auditor C-CLERC expires this year. The audit committee should receive some other proposals and will submit their recommendation to the Annual General Meeting.

The Board of Directors


Audit report on the Company’s financial statements To the shareholders of Socfinaf S.A. 4, Avenue Guillaume L-1650 Luxembourg REPORT OF THE RÉVISEUR D’ENTREPRISES AGRÉÉ Report on the audit of the financial statements Opinion We have audited the financial statements of SOCFINAF SA (the "Company") comprising the balance sheet as at 31st December 2019 and the profit and loss account for the year then ended, and the notes to the financial statements, including a summary of the main accounting policies. In our opinion, the accompanying financial statements give a true and fair view of the Company's financial position as at 31st December 2019, as well as the results for the year then ended, in accordance with the legal and regulatory requirements for the establishment and the presentation of the financial statements in force in Luxembourg. Basis of opinion We conducted our audit in accordance with the Regulation (EU) N ° 537/2014, the law of 23rd July 2016 relating to the audit profession (the law of 23rd July 2016) and the International Standards on Auditing (ISA ) as adopted for Luxembourg by the Commission de Surveillance du Secteur Financier CSSF) fully described in the section entitled "Responsibilities of the Certified Auditor for the audit of the financial statements" of this report. We are also independent from the Company in accordance with the Code of Ethics of Professional Accountants of the International Accounting Standards Board (the IESBA Code) as adopted for Luxembourg by the CSSF and the rules of professional conduct apply to the audit of the financial statements and we have fulfilled the other responsibilities incumbent on us under these rules. We believe that the audit evidence we have gathered is sufficient and appropriate to provide a basis for our audit opinion. Emphasis of matter Without qualifying our opinion, we draw attention to Note 7 “Political and economic environment”. The Company holds investments where the operational companies are located in various African countries and which are exposed to the risk of political and economic fluctuations. Key Audit issues Key audit matters are those matters that, in our professional judgment, have been the most significant in the audit of the financial statements for the period. These matters have been addressed in the context of our audit of the financial statements as a whole and for the purpose of forming our opinion on them, and we do not express a separate opinion on these issues. Valuation of shares in related companies Description of the key audit matter As at 31st December 2019, the net value of the shares in affiliated companies amounted to EUR 239 million, representing 44% of the balance sheet total.


These shares in affiliated companies are valued at the lower of their acquisition price or the estimated realizable value by the Board of Directors. The assessment of the estimated realizable value of these investments requires the exercise of the judgment of the Board of Directors in its choice of the elements to be considered according to the participations concerned. These items may be historical (share of statutory or consolidated net assets) and / or expected (profitability outlook) as well as the usefulness for the Company. Due to the significant number of shares in the related companies as well as the judgment necessary for the assessment of their value by the Board of Directors, we considered the valuation of shares in related companies as a key audit matter. Audit response provided In assessing the reasonableness of the estimate of the value of the shares in the related companies, our work consisted mainly to:

- assess, on the basis of the information provided by the Board of Directors, the valuation methods used by the Company;

- for evaluations based on historical elements: • assess the assumptions used to determine the revalued net asset value; • in particular, to verify that the retained equity is consistent with the entities

'accounts and that the adjustments made, if any, on these shareholders' equity is based on appropriate documentation;

- for evaluations based on other elements than on historical elements: • carry out an analysis on the evolution of the financial and non-financial data of the

related companies and their activity; • examine the assumptions made regarding the economic environment at the closing

and accounting dates. Our work also consisted of:

- assess the recoverability of the receivables attached to the shares; - to verify the appropriateness of the information presented under Note 3 "Financial fixed

assets “ Other information Responsibility for other information rests with the Board of Directors. Other information consists of the information presented in the annual report including the management reports and the corporate governance statement but does not include the financial statements and our independent auditor report on these financial statements. Our opinion on the financial statements does not extend to other information and we do not express any form of assurance on such information. With respect to our audit of the financial statements, our responsibility is to read the other information and, in doing so, assess whether there is a material inconsistency between the financial statements and the knowledge we acquired during the course of the financial statements, the audit, or if the other information otherwise appears to contain a significant anomaly. If, based on our work, we conclude that there is a significant discrepancy in the other information, we are required to report that fact. We have nothing to report in this regard. Responsibilities of the Board of Directors for the financial statements The Board of Directors is responsible for the preparation and fair presentation of the financial statements in accordance with the legal and regulatory requirements relating to the preparation and presentation of the financial statements in force in Luxembourg, as well as the internal control that it considers as necessary to permit the preparation of financial statements that are free from material misstatement, whether due to fraud or error.


In preparing the financial statements, it is the responsibility of the Board of Directors to assess the Company's ability to continue as a going concern, to disclose, as the case may be, issues relating to the continuity of operations and to apply the accounting principle of going concern, unless the Board of Directors intends to liquidate the Company or cease its activity or if no other realistic solution is offered to it. Auditors Responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance that the financial statements taken as a whole do not contain any material misstatement, whether due to fraud or error, and to issue a report from the independent auditor containing our opinion. Reasonable assurance corresponds to a high level of assurance, which however does not guarantee that an audit carried out in accordance with Regulation (EU) No 537/2014, the Law of 23rd July 2016 and the ISAs as adopted for Luxembourg by the CSSF will always detect any significant anomaly that may exist. Anomalies may arise from fraud or error and are considered material when it is reasonable to expect that, individually or collectively, they could affect the economic decisions that users of the financial statements take in their business based on these. In the context of an audit conducted in accordance with Regulation (EU) No 537/2014, the law of 23rd July 2016 and ISAs as adopted for Luxembourg by the CSSF, we exercise our professional judgment and exercise due diligence critical mind throughout this audit. In addition:

• We identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, the design and implementation of audit procedures in response to such risks, and the collection of audit evidence sufficient and appropriate to base our opinion. The risk of non-detection of a significant anomaly resulting from fraud is higher than that of a significant anomaly resulting from an error, since the fraud may involve collusion, forgery, voluntary omissions, misrepresentation or circumventing internal control;

• We gain an understanding of the internal control elements relevant to the audit in order to

design audit procedures appropriate to the circumstances and not to express an opinion on the effectiveness of the Company's internal control;

• We assess the appropriateness of the accounting policies used, and the reasonableness of the

accounting estimates made by the Board of Directors, as well as the related information provided by the Board;

• We draw a conclusion as to the appropriateness of the Board of Directors' use of the going concern accounting principle and, depending on the audit evidence obtained, whether or not there is significant uncertainty related to events or situations that may cast significant doubt on the Company's ability to continue as a going concern. If we find material uncertainty, we are required to draw the attention of readers of our report to the information provided in the financial statements about this uncertainty or, if this information is not adequate, to express a modified opinion. Our conclusions are based on the evidence obtained up to the date of our report. However, future events or situations could cause the Company to cease operations;

• We evaluate the overall presentation, the form and content of the financial statements,

including the information provided in the notes, and assess whether the financial statements represent the underlying transactions and events in a manner that conveys an image loyal.

We communicate to corporate governance officials, in particular, the scope and expected timing of the audit work and our significant findings, including any significant internal control deficiencies we may have identified during our audit. We also provide corporate governance officials with a statement that we have complied with the relevant ethical rules regarding independence and disclose to them all relationships and other factors that may reasonably be expected to affect the independence of the organization. our independence and related safeguards where applicable.


Among the questions communicated to corporate governance officials, we determine which were the most important in the audit of the financial statements of the period in question: these are the key questions of the audit. We describe these issues in our report unless legal or regulatory provisions prevent them from being published. Report on other legal and regulatory requirements We were appointed as statutory auditor by the General Meeting of Shareholders on 31st May 2017 and the total duration of our mission without interruption, including previous renewals and renewals, is 5 years. The management report is consistent with the financial statements and has been prepared in accordance with applicable legal requirements. The information required by article 68bis paragraph (1) letters c) and d) of the amended law of 19th December 2002 concerning the commercial and companies register and the accounting and annual accounts of the companies included in the consolidated management report and presented on pages 42 to 43 and in the Company’s management report and presented on pages 126 to 127 are consistent with the Company's financial statements and have been prepared in accordance with applicable legal requirements. We confirm that our audit opinion is in accordance with the content of the supplementary report to the Audit Committee or the equivalent body. We confirm that we have not provided any prohibited non-audit services as referred to in Regulation (EU) No 537/2014 and that we have remained independent from the Company during the audit. Bertrange, 9th March 2020 C-CLERC S.A. Cabinet de revision agréé Mariateresa Di Martino Réviseur d’entreprises agréé


Company Financial Statements

1. Balance sheet as at 31st December 2018

2019 2017 A S S E T S Note EUR EUR FIXED ASSETS Financial fixed assets 3 Shares in affiliated undertakings 239 027 474.05 240 686 923.24

Loans to affiliated undertakings 304 096 770.27 298 619 716.61

543 124 244.32 539 306 639.85 Current assets Receivables Amounts owed by affiliated undertakings becoming due and payable within one year 2 813 410.86 8 183.71 Other receivables becoming due and payable within one year 2 116 543.89 740 124.38

4 929 954.75 748 308.09 Transferable securities Shares in affiliated undertakings 248 406.09 248 406.09 Cash at bank, cash in postal cheque accounts, cheques and cash in hand 168 020.13 284 605.03

TOTAL ASSETS 548 470 625.29 540 587 959.06

The notes form an integral part of the annual accounts.


2019 2017 L I A B I L I T I E S Note EUR EUR SHAREHOLDERS 'EQUITY 4 Share capital 35 673 300.00 35 673 300.00 Share premiums 87 453 866.21 87 453 866.21 Reserves Legal reserve 3 567 330.00 3 570 840.00 Other reserves, including the fair value reserve Other available reserves 688 346.92 688 346.92

4 255 676.92 4 259 186.92

Retained earnings 131 986 469.61 111 698 916.51 Results for the financial year 21 577 356.83 20 284 043.10

280 946 669.57 259 369 312.74 LIABILITIES Amounts owed to affiliated undertakings Becoming due and payable after more than one year 90 000 000.00 90 000 000.00 Becoming due and payable within one year 137 019 083.12 150 487 094.37 Other debts Becoming due and payable within one year 40 504 872.60 40 731 551.95

267 523 955.72 281 218 646.32

TOTAL LIABILITIES 548 470 625.29 540 587 959.06 The notes form an integral part of the annual accounts.


2. Income statement for the year ended 31st December 2019

2019 2018 Note EUR EUR Raw materials and consumables and others external charges Other external charges -3 066 883.19 -4 055 430.29 Value adjustments on current assets 0.00 149 128.52 Other operating expenses -644 149.53 -619 957.05 Income from participating interests from affiliated undertakings 5 36 999 400.78 35 585 734.06 Other interest receivable and other financial income

Other interests and financial income 22 906.60 25 203.09 Impairment losses on financial assets and securities held as current assets -1 301 090.27 0 00 Interest and other financial expenses Other interest and financial charges -7 486 494.12 -8 600 876.27 Income tax -2 462 173.44 -1 807 578.96

Results after taxation 22 061 516.83 20 676 223.10 Other taxes not shown above -484 160.00 -392 180.00

Results for the financial year 21 577 356.83 20 284 043.10 Proposed distribution of profits 2019 2018 EUR EUR Retained earnings 153 563 826.44 131 986 469.61 From the balance: 10% to the Board of Directors 0.00 0.00 90% to 17 836 650 shares 0.00 0.00

153 563 826.44 131 986 469.61 Dividend per share 0.00 0.00 The notes form an integral part of the annual accounts.


3. Notes to the parent company financial statements for the 2019 financial year

Note 1. Overview The Company was incorporated on 22nd October 1961 as a public limited company and adopted the status of "Soparfi" on 10th January 2011. The duration of the Company is unlimited, and its registered office is established in Luxembourg. The Company is registered in the Register of Commerce and Companies under number B 6225. The financial year begins on 1st January and ends on 31st December. Note 2. Accounting principles, rules and methods General principles The annual financial statements are prepared in accordance with Luxembourg legal and regulatory provisions and generally accepted accounting practices. Although the Company is included in the consolidated financial statements of Société Financière des Caoutchoucs, abbreviated as "Socfin", the Company prepares consolidated financial statements as a result of its listing on the Luxembourg Stock Exchange. The consolidated financial statements can be consulted on the website www.socfin.com. Currency conversion The Company keeps its accounts in euros (EUR); the annual accounts are expressed in this currency. Transactions in a currency other than the balance sheet currency are converted into the balance sheet currency at the exchange rate prevailing on the date of the transaction. At the balance sheet date:

- the purchase price of the equity securities included in the financial fixed assets and the associated receivables, expressed in a currency other than the currency of the balance sheet, remain converted at the historical exchange rate;

- bank accounts expressed in a currency other than the currency of the balance sheet are

valued on the basis of the exchange rate prevailing on the balance sheet date;

- all other assets, expressed in a currency other than the currency of the balance sheet, are valued individually at the lower of their value at the historical exchange rate or their value determined on the basis of the exchange rate prevailing at the balance sheet date;

- all liability items, expressed in a currency other than the currency of the balance sheet, are

valued individually at the highest of their value at the historical exchange rate or their value determined on the basis of the exchange rate prevailing on the closing date.

Realized foreign exchange gains and losses are recognized in profit and loss. At the balance sheet date, by applying the precautionary principle, only negative translation adjustments on foreign currency items are recognized in profit or loss. If there is an economic link between two transactions, unrealized exchange differences are recognized at the corresponding unrealized exchange loss.

http://www.socfin.com/


Revaluation of financial assets Investments and securities with a capital nature are valued individually at the lower of their purchase price or their value estimated by the Board of Directors, without compensation between capital gains and losses. The purchase price includes the purchase price and incidental expenses. To determine the estimated value, the Board of Directors is based on: - on the market value; - the financial statements of the companies to be valued; - or other information and documents available. Receivables Receivables are recorded at their nominal value. They are subject to value adjustments when their recovery is compromised. Value adjustments are not maintained if the reasons for their negotiations have ceased to exist. Securities Securities are valued at the lowest cost, including incidental costs or market value. A value adjustment is recorded when the market price is lower than the purchase price. Liabilities Liabilities are recorded at their nominal value.


Note 3. Financial fixed assets

Shares in Loans to Total

affiliated undertakings affiliated undertakings

2019 2018 2019 2018 2019 2018

EUR EUR EUR EUR EUR EUR Acquisition cost/nominal value at the beginning of the year 244 708 284.16 245 568 061.66 298 619 716.61 258 747 622.49 543 328 000.77 504 315 684.15 Increases 0.00 0.00 6 706 263.75 40 077 526.81 6 706 263.75 40 077 526.81 Decreases -358 358.92 -859 777.50 -1 229 210.09 -205 432.69 -1 587 569.01 -1 065 210.19

Acquisition cost/nominal value at the end of the year 244 349 925.24 244 708 284.16 304 096 770.27 298 619 716.61 548 446 695.51 543 328 000.77 Value adjustments at the beginning of the year -4 021 360.92 -4 881 138.42 0.00 0.00 -4 021 360.92 -4 881 138.42 Impairments -1 301 090.27 0.00 0.00 0.00 -1 301 090.27 0.00 Reversals 0.00 859 777.50 0.00 859 777.50

Value adjustments at the end of the year -5 322 451.19 -4 021 360.92 0.00 0.00 -5 322 451.19 -4 021 360.92 Net book value at the end of the year 239 027 474.05 240 686 923.24 304 096 770.27 298 619 716.61 543 124 244.32 539 306 639.85


Information on companies in which the Company holds at least 20% of the capital

Dénomination Country % help Net book value EUR

Year end Currencies of the annual accounts

Equity in foreign

currency (including net

income)

Net income in foreign

currencies

Plantations Socfinaf Ghana (*) Ghana 100.00 32 503 775 31 December 2019 GHS 171 033 564 -43 203 858

Socfin Agricultural Company Ltd (*) Sierra Leone 93.00 20 445 954 31 December 2019 USD -1 721 407 -11 933 525

Liberian Agricultural Company (*) Liberia 100.00 13 793 904 31 December 2019 USD 53 358 447 -1 387 050

Salala Rubber Corporation (*) Liberia 64.91 21 580 186 31 December 2019 USD 6 661 174 -2 577 000

Bereby-Finances S.A. « BEFIN » (*) Ivory Coast 87.06 13 604 405 31 December 2019 XAF 14 265 671 581 2 826 731 638

Socapalm S.A. (*) Cameroon 67.46 40 640 840 31 December 2019 XAF 74 597 497 414 12 245 177 253

Okomu Oil Palm Company Plc (*) Nigeria 64.97 20 356 859 31 December 2019 NGN 29 109 408 266 5 504 938 101

Brabanta S.A. (*) Congo (DRC) 99.80 24 971 342 31 December 2019 CDF 43 909 424 147 -7 834 332 538

Induservices S.A. Luxembourg 30.00 30 000 31 December 2019 EUR 232 194 5 900

Management Associates S.A. Luxembourg 20.00 400 000 31 December 2019 EUR 2 605 007 39 235

Socfinde S.A. (*) Luxembourg 20.00 801 000 31 December 2019 EUR 5 940 928 268 572

Terrasia S.A. Luxembourg 33.28 246 705 31 December 2019 EUR 527 209 23 319

SAFA France 100.00 26 535 600 31 December 2019 EUR 20 310 160 495 861

Induservices FR S.A. Switzerland 50.00 642 202 31 December 2019 EUR 762 681 -5 359

Socfinco FR S.A. (*) Switzerland 50.00 486 891 31 December 2019 EUR 9 774 951 4 227 405

Sogescol FR S.A. (*) Switzerland 50.00 1 985 019 31 December 2019 USD 16 724 768 7 411 532

Socfin Green Energy S.A. Switzerland 50.00 48 780 31 December 2019 EUR 1 505 666 202 686

Socfin Research S.A. Switzerland 50.00 1 968 120 31 December 2019 EUR 3 936 243 -391 325

Sodimex FR S.A. (*) Switzerland 50.00 621 424 31 December 2019 EUR 3 745 512 406 925

Centrages S.A. Belgium 50.00 4 074 577 31 December 2019 EUR 3 020 755 170 107

Gaummes S.A. Belgium 50.00 47 532 31 December 2019 EUR 103 055 -8 547

Immobilière de la Pépinière S.A. Belgium 50.00 3 165 450 31 December 2019 EUR 3 901 897 -206 935

Socfinco S.A. Belgium 50.00 1 680 763 31 December 2019 EUR 1 739 330 194 686

Sodimex S.A. (*) Belgium 50.00 102 200 31 December 2019 EUR 204 180 -16 094

STP Invest S.A. Belgium 100.00 3 000 090 31 December 2019 EUR 1 777 008 -1 157

233 733 618

(*) : Based on Audited Financial Statements


Note 4. Equity

Capital Share Legal Other Retained Profit for Interim

subscribed premium reserves reserves earnings the financial year

dividends

EUR EUR EUR EUR EUR EUR EUR Balance as at 1st January 2018 35 708 400.00 87 453 866.21 3 570 840.00 632 518.92 104 670 732.11 9 010 034.40 0.00

Allocation of the result for the 2017 financial year following decision of the Annual General Meeting held on 31st May 2018:

• Retained earnings 7 028 184.40 -7 028 184.40

• Dividends -1 783 665.00

• Directors' fees -198 185.00

Cancellation of 17 550 shares -35 100.00 55 828.00 Results for the financial year 20 284 043.10

Balance as at 31st December 2018 35 673 300.00 87 453 866.21 3 570 840.00 688 346.92 111 698 916.51 20 284 043.10 0.00

Allocation of the result for the 2018 financial year following decision of the Annual General Meeting held on 28th May 2019:

• Retained earnings -3,150.00 20 287 553.10 -20 284 043.10

Results for the financial year 21 577 356.83

Balance as at 31st December 2019 35 673 300.00 87 453 866.21 3 567 330.00 688 346.92 131 986 469.61 21 577 356.83 0.00


Subscribed capital and share premium As at 31st December 2019, the subscribed and fully paid up share capital is EUR 35 673 300. It is represented by 17 836 650 shares without par value designation. In accordance with the law of 28th July 2014 on the immobilization of bearer shares, 17 550 shares have been cancelled. As at 31st December 2019 and 2018, the share premium amounts to EUR 87 453 866. Legal reserve According to the legislation in force, the annual profit is subject to a levy of 5% to be allocated to a legal reserve. This deduction ceases to be compulsory as soon as the reserve reaches 10% of the capital. The legal reserve cannot be distributed. Other reserves Other reserves were established in 2002 for an amount of EUR 807 552. They were increased during this financial year by an amount of EUR 55 828 which corresponds to the cancellation of the 17 550 shares. Note 5. Income from equity investments 2019 2018 EUR EUR Dividends received 33 458 705.96 33 453 814.13 Interest on related companies’ receivables 2 522 687.05 2 131 919.93 Capital gain on disposal of financial fixed assets 1 018 007.77 0.00

36 999 400.78 35 585 734.06 Note 6. Remuneration of the Board of Directors During the 2019 financial year, the members of the Board of Directors received EUR 9 687 in attendance fees and EUR 629 660 in directors' fees. Note 7. Political and economic environment Most of the investments are held directly or indirectly in companies operating in Africa, particularly in the following countries: - Sierra Leone, - Liberia, - Ivory Coast, - Ghana, - Nigeria, - São Tomé et Principe, - Cameroon, - Congo (DRC). Given the political instability that exists in these countries and their economic fragility (dependence on international aid, inflation in some cases, civil wars, etc), the investments held by the Company present a risk in terms of exposure to political and economic fluctuations.


Note 8. Significant events after the end of the year The Covid-19 epidemic began in China in December 2019 and spread to the rest of the world from January 2020 and rose to “pandemic” status on 11th March 2020 by the WHO. At the balance sheet date, the epidemic had no impact on the Group's activities. The Covid-19 epidemic, which took a global dimension, caused the financial markets to fall dramatically from mid-February onwards, rising fears of a slowdown in global economic growth. Raw material prices were obviously not spared. Thus, the TSR20 1st position FOB Singapore on SGX quoted on 27th March 2020 at USD 1 070 per ton, against USD 1 451 per ton on 31st December 2019. Similarly, the price of crude palm oil CIF Rotterdam closed on 27th March 2020 at around USD 620 per ton, against USD 850 per ton on 31st December 2019. The Covid-19 crisis has strongly affected sectors linked to the Chinese economy, particularly groups operating in the automotive industry, already in slowdown. In addition, tyre manufacturers are in the process of halting and/or drastically reducing production at most of their factories in Europe, North America, South America and elsewhere in the world. The Board of Directors expect a sharp decline in rubber demand from tyre manufacturers from April onwards. Slower growth in China and the recent lockdown in India, the two major palm oil importers, and falling oil prices are also weighing heavily on current crude palm oil prices. The situation is being closely monitored by the management teams. However, it is too early to assess the full impact of the Covid-19 epidemic on the financial year 2020. First quarter operations were not affected by this crisis. Moreover, 70% of palm oil is sold locally on markets that offer a price which is sustainably higher than the world market price.

FINAF 2 - socfin.com · Socfinaf S.A. – Annual Report 2019 - 6 • 31/12/2001 Further increase in share capital which allowed Intercultures to increase its stake in Okomu Oil Palm

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